Some maquiladoras and industries in Juárez at risk of relocating due to tariff impact

CIUDAD JUÁREZ, Chihuahua (KVIA) -- Last Friday, the U.S. Supreme Court struck down the vast majority of tariffs imposed by President Trump since the beginning of his administration last year. According to business leaders on the border, eliminating reciprocal tariffs puts companies at risk of leaving Ciudad Juárez.

"Initially, it's positive that the court has halted these harsh decisions by the White House, which is good for industry, but many of the tariffs struck down by the Supreme Court are what keep some companies operating in Ciudad Juárez," stated the Chihuahua Delegate of the Mexican Association of Importers and Exporters (ANIERM), Marcelo Vázquez.

Beyond the political implications of this in the United States, ANIERM delegate Vázquez points out that it could also have serious consequences for Ciudad Juárez, which is already facing a severe employment crisis, especially in the maquiladora sector.

Central American countries like Honduras and Guatemala are being penalized by the United States with these reciprocal tariffs, and ANIERM says that these countries are cheaper because they pay lower wages and taxes, since the tariffs are driving up costs too much.

"If the reciprocal tariffs are eliminated, as the Supreme Court has already ordered, it will be more advantageous for many maquiladoras to relocate their production there (Central America)," ANIERM delegate Vázquez added. "Some very important strategic partners have already been moving production lines and opening new contracts in Honduras at the request of their clients."

The reciprocal tariffs had slowed down some industries, but now that they have been eliminated, they will surely resume those plans, according to business experts.

"Of course, they will wait a while to see what else President Trump does, since he has already announced that he will try to reinstate the tariffs by other means, so these companies, which are on the verge of a cost crisis, will surely wait for Trump's reaction and then make their decision," ANIERM delegate Vázquez said.

ABC-7 also spoke with UTEP Professor of Economics and Finance Dr. Tom Fullerton, who said President Trump has been trying to circumvent some constitutional laws in the United States by declaring "so-called" emergencies to enable him to impose tariffs on many imports from a variety of countries, admitting that the U.S. is using tariffs as a negotiation ploy to get concessions from other countries.

In this matter, the U.S. Congress is the organization in the United States that has the power to impose tariffs. If the White House wants new tariffs, it has to propose legislation to Congress and work it through, a process that takes quite a long time, according to Dr. Fullerton.

"Northern Mexico has not lost its comparative and competitive advantages, nor has it lost the experienced workforce it already has; so I don't think that's really going to be a risk of maquiladoras moving out of Mexico or the Juárez border area," Dr. Fullerton said. "In terms of what's going to happen with the 15% tariffs, this probably causes paperwork headaches for a lot of companies, although the companies that are already operating in Canada, the United States and Mexico under USMCA should still be in good shape, because anything that's under USMCA regulations should still be following the USMCA guidelines and this shouldn't cause them any additional headaches, but for a lot of other companies it will."

According to Dr. Fullerton, several companies on the border are also facing economic uncertainty and those paperwork headaches, which affect consumers along the way as well.

"Now, it's probably going to affect consumers in a way that hasn't gotten much attention, because the 15% tariff is lower than the 18% effective average tariff rate that was in place before next week, and consumers around the United States (the estimates vary), but essentially households were paying an additional $1,700 because of tariff price hikes, and now that should translate into an annual savings of about $320 per household, because the overall rate has effectively declined 15%," Professor Fullerton added.

One thing that could also happen is that because of that economic uncertainty over how things and a new round of reciprocal tariffs are going to be implemented, the U.S. may see more uneven inventory stocking problems. Some companies may have to hold off on bringing in new goods, while other companies may bring more goods in case the tariff situation worsens.

"So we may continue to see the types of inventory problems that were observed during the first half of 2025, where companies would rush to bring in merchandise before the effective dates of tariffs and then they would hold off once those tariffs were in place; that pattern may reemerge," Dr. Fullerton also said. "But beyond that, the biggest change will be that prices overall should go down about 20%, in terms of those tariff hikes. That doesn't mean price levels will drop 20%, but in terms of the tariff margins that were added to a lot of goods, those margins should shrink by about 20%, and over the course of 12 months, that should translate into savings of about $320 per household in the United States."

For business and economy experts like Dr. Fullerton, the "ace in the hole" that some households have here in the borderplex is that when prices get high on either side of the border, they can go to the other side of the border and take advantage of lower prices, which could still be a good option for local families.

"It's clear that the White House doesn't like this ruling by the Supreme Court, so there's probably going to be more attempts to impose things like this temporarily," Dr. Fullerton added. "There may be presidential executive orders that get issued that violate the decision of the Supreme Court last week, but they'll do it knowing that it takes a while for any type of legal action that's taken against those measures to work its way up to the Supreme Court, so I expect that it will be a bumpy ride in terms of trade legislation as we move into the rest of 2026 and on into 2027."

Therefore, they say it could still be several months before this court ruling has a visible effect on the local economy of Juárez and the border region.

Watch the full story tonight on ABC-7 at 10.