Mexico's Auto Sector Signals First Recovery Since Trump's Tariff War
The industry shed 107,000 jobs in two years. Now 37% of major employers plan to hire in Q3, led by northern Mexico where GM, KIA, and Audi are expanding.
Mexico's automotive factories have been bleeding jobs for two years. In April, the sector employed 742,000 people, 50,000 fewer than a year ago, and 107,000 fewer than two years ago. But a new ManpowerGroup survey says 37% of major employers expect to start hiring again in the third quarter, the first real signal of recovery since Trump's tariff war hit.
That is the headline number. The details behind it tell a more complicated story.
Tania Arita, recruitment director at ManpowerGroup MeCCA, the multinational that surveyed over 1,000 employers, said the auto sector has been in a holding pattern for months. "The automotive sector has recently experienced an operational reactivation after a period of adjustments and caution due to tariffs and supply chain realignment; exports are also recovering.," she said. Translation: the industry is waking up after a long nap caused by tariff uncertainty.
"We come from previous quarters where there was a lot of caution, many companies waiting, but today everything related to car sales and exports has grown," she added. In English: previous quarters were all caution and waiting. Now sales and exports are growing.
The numbers back her up. From January to May, vehicle exports rose 4%, production held roughly flat with a 0.1% decline, and new car sales grew 5%, according to Inegi data. Those are not earth-shaking numbers, but after the tariff shock of early 2025, even flat feels like progress.
The Northern Rebound
The recovery is geographically lopsided. Northern Mexico, where most auto plants sit, leads the charge. ManpowerGroup found that 45% of employers in the region plan to create new positions, the strongest hiring trend in the country.
That makes sense. The northern states are where the maquiladoras cluster, where the supply chains run deepest, and where proximity to the U.S. border makes logistics cheapest. GM, KIA, Audi, and Yazaki have all announced expansions or new investments in the region in recent months.
General Motors is pouring $1 billion into its Coahuila plants to produce the Aveo and Groove models. KIA is expanding in Nuevo León. Yazaki, the Japanese auto parts maker, is also investing in Nuevo León. Audi has announced 800 new positions in Puebla. Those are not speculative hires. They are tied to real production commitments.
The ANPACT, Mexico's heavy vehicle manufacturers' association, said employment has "stabilized" after the loss of 6,000 jobs earlier this year. No more layoffs. That is the floor. The question is how fast the ceiling rises.
For the workers who get those jobs, the pay depends heavily on where they are and what they speak. A production operator in a typical plant earns between 14,000 and 16,000 pesos a month, roughly $700 to $800 USD, with benefits like transport and a cafeteria. Technicians with more experience make 16,000 to 25,000 pesos. But if they speak English, their income can jump to 40,000 pesos, about $2,000 a month.
That English premium tells you something about where the industry is headed. Mexico is not just assembling cars anymore. The shift toward electric vehicles is creating demand for engineers in battery technology, high-voltage systems, and software development. Nuevo León, Coahuila, and Guanajuato are the hotspots for EV-related hiring.
None of this erases the damage Trump's tariffs caused. The auto sector lost 107,000 jobs in two years. Some of those are gone permanently, absorbed by automation or moved to other countries. The recovery ManpowerGroup is measuring is partial, not complete.
Scotiabank analyst Eduardo Suárez noted that the risks are not gone. If Trump escalates tariffs again, or if the U.S. economy slows, the hiring plans could evaporate as quickly as they appeared. Mexican auto exports are deeply intertwined with American demand, and any shock to U.S. consumer spending hits Mexico's factories within weeks.
But for now, the trend is pointing up. Plants are hiring. Investments are landing. The supply chain is stabilizing. And 742,000 workers in the Mexican auto industry are watching to see whether this quarter's optimism becomes next year's reality.
The car you drive may have been assembled in one of these factories. The question is whether the people who built it still have jobs next year.