Baker said the uncertainty caused by tariffs or any type of disruption, such as the COVID pandemic, affects long-term investment decisions, as manufacturers typically plan supply chain strategies years in advance.

“It isn’t easy for manufacturers to implement a new supply chain strategy,” Baker said. “When things like tariffs or pandemics disrupt that supply chain, then it’s very difficult for manufacturers to turn that ship and respond quickly, because they’re relying on other manufacturers to provide them with equipment they might need to have locally or to retool their supply chains, especially when you see the environment changing so quickly back and forth.”

Baker said most big car companies are taking a wait-and-see approach to tariffs but have not significantly changed their supply chains yet.

“My impression is that a lot of original equipment manufacturers, they’re watching it out of the corner of their eye, … ‘Hey, we’ve got to pay attention to this over here,’” Baker said. “But I really haven’t seen a wholesale change in the supply chain strategy.”

Jacob Shapiro, director of research at The Bespoke Group, said that beyond policy uncertainty, Mexico faces challenges such as building the infrastructure needed to accommodate a large increase in manufacturing activity.

The Bespoke Group is an Evergreen, Colorado-based wealth strategy firm.

“The biggest problem for Mexico is going to be capacity,” Shapiro told FreightWaves in an interview. “Are they going to be able to build out energy infrastructure and things like that to meet the energy demand that is coming? Are they going to be able to deal with scarce water resources in some towns on the border for what’s coming?”

Shapiro also said the uncertainty created by the Trump administration could undermine trade confidence in North America and the United States-Mexico-Canada Agreement.

“The United States enjoyed its position globally because it was the most trusted and the most stable power in the world. Now there’s countries and blocs that are saying the United States is not dependable anymore,” he said. “During Trump’s first administration and Biden’s administration, it seemed like, especially in 2020 when the new USMCA was signed, that there might be this North American trade bloc, U.S., Canada and Mexico. I don’t know if it’s gone away, but it’s been very strained since Trump’s second term in office began.”

For trade stakeholders, nearshoring should be considered a long-term trend rather than a short-term phenomenon, according to Shapiro.

“I think we’re at the very, very early stages of nearshoring,” he said. “I think this is a phenomenon that’s going to emerge over a time horizon of decades that is ultimately going to be very positive for Mexico in particular and also for the companies that are ahead of the curve on noticing that.”

Dewart said he is also bullish on Mexico’s long-term prospects.

“Regardless of what happens, Mexico is going to be the winner of these trade wars,” Dewart said. “I wouldn’t say they pull the trigger and they’re relocating factories, but they’re actively asking for quotes, comparing rates on the ocean world versus what it would look like coming from Mexico.”

Buhler Group, a Swiss industrial agricultural equipment manufacturer, recently began construction of a $24 million plant in Torreón, Mexico.

The plant, which will create 200 jobs, will perform sheet metal work, equipment assembly and painting. The facility is Buhler Group’s first manufacturing plant in Mexico.

Torreón is in northern Mexico, about 343 miles from Laredo, Texas.

The facility will support the manufacturing needs of Buhler’s grains and food business and is part of the company’s growth plans in the Americas, according to a news release.

Buhler Group is based in Uzwil, Switzerland. The company has more than 12,300 employees, and operates 30 manufacturing sites in over 140 countries, including three plants in the U.S.

Frisa recently launched a hot rolling steel mill in Monterrey, Mexico.

The $350 million facility generated more than 450 jobs and expanded the company’s steel production capacity in sectors such as aerospace, semiconductors, wind energy and power generation, according to a news release.

Most of Frisa’s steel production is exported to customers in the U.S., along with Europe and Asia.

Founded in Monterrey in 1971, Frisa has more than 3,000 employees. The company has four steel plants and a distribution center in Mexico, along with one factory in the U.S.

NRS Logistics America Inc. recently opened the Chemical Logistic Park in Casa Grande, Arizona, just south of Phoenix.

With a total investment of $90 million, Chemical Logistic Park includes a 67,680-square-foot chemical warehouse, a 9,467-square-foot gas pad, a container storage yard and tank container maintenance facility.

The logistics hub will serve semiconductor and electric vehicle battery manufacturers and suppliers, as well as industrial chemical markets.

White Plains, New York-based NRS Logistics America is a chemical-logistics company providing transport, storage and distribution, and asset leasing services for the chemical and industrial markets.

NRS Logistics America is a subsidiary of Tokyo-based NRS Corp., an international freight forwarder.

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