Trump’s trade chief says the U.S. could quit or split T-MEC in 2026, reviving uncertainty that hits Mexico’s export-driven economy.
A warning that once lived on campaign stages has now moved into official policy talk. U.S. Trade Representative Jamieson Greer has said Donald Trump could decide next year to pull the United States out of the Trade Agreement between Mexico, the United States and Canada (T-MEC) or break it into separate deals with Mexico and Canada. The timing is not casual. The first formal review of the treaty is due in 2026, and the White House is already signaling that “no change” is not the default choice.
Greer laid out the logic in a podcast interview. He described a president who “only wants deals that are a good deal” and said the review period was built into T-MEC precisely so Washington could revise it or, if needed, exit. He also confirmed that Trump has discussed the option of negotiating new, separate agreements with each neighbor, instead of keeping the trilateral framework that has governed North American trade for three decades.
On its face, nothing in the treaty has changed. Under Article 34.6 of the USMCA, as the accord is known in English, any country can withdraw by giving written notice and waiting six months. Under Article 34.7, the three governments must hold a joint review in 2026 and decide whether to extend the agreement’s life toward its 2036 sunset date or leave the question open. But airing the withdrawal option now shifts the political weather around that review and raises the cost of missteps for Mexico.
For Mexico, the stakes are unusually high. More than four-fifths of its goods exports go to the United States, according to U.S. trade data, and nearly half of its imports come from its northern neighbor. The T-MEC framework underpins a flow of Mexican exports to the U.S. that reached more than 500 billion dollars in 2024, making the United States Mexico’s dominant customer by a wide margin. Much of that exchange is not one-off shipments but tightly linked supply chains that move parts and finished goods back and forth several times before they reach consumers.
Nowhere is that interdependence more visible than in autos. Mexico exported roughly 2.9 million vehicles in 2024 and shipped around 181 billion dollars in vehicles and auto parts to the U.S., close to a third of all Mexican exports to that market. T-MEC’s rules of origin, wage requirements and tariff preferences were designed to keep that production web in North America, even as companies hunt for lower costs and new investment spots inside the region. A credible threat to walk away from the deal, or to carve it into two separate tracks, lands directly in the middle of that model.
Claudia Sheinbaum, Mexico’s president, has tried to anchor the debate in that shared dependence. After confirming that she expects a brief meeting with Trump in Washington, she warned that “separating that integration causes many problems for the United States and also for Mexico” and argued that staying together is “very important for the region.” Her government has framed T-MEC not only as Mexico’s gateway to its top export market, but also as a shield for U.S. manufacturers that rely on Mexican plants for parts, labor and nearshored capacity.
Sheinbaum has already clashed with Washington over new U.S. auto tariffs, calling them a unilateral decision that undercuts North American integration rather than strengthening it. At the same time, she has insisted that major automakers are not about to abandon Mexico, pointing to sunk investment and cluster effects around plants in states like Guanajuato, Coahuila and Nuevo León. Industry associations on both sides of the border have echoed her point that any new duties hit all three economies because so many vehicles cross borders multiple times before final assembly.
Factories, border cities and a new round of uncertainty
Greer’s remarks land after months of rising tension over T-MEC enforcement. He has repeatedly argued that Mexico is not fully complying with its obligations in sectors such as energy and telecoms, and U.S. officials have hinted that non-compliance could feed into the 2026 review. Business groups already worried that the review clause itself adds uncertainty now face the prospect that Washington could hold up renewal, or even brandish formal withdrawal, as leverage for new concessions.
In parallel, Mexico has tried to present itself as the responsible adult in the room. Sheinbaum and her economic team say technical talks with U.S. counterparts are “very advanced” and that they want most sensitive issues—like steel and aluminum trade—off the table before the formal review window opens. Mexico and Canada have also announced joint work plans to defend integrated supply chains and present a common front against any attempt to turn T-MEC into a series of bilateral deals.
For Mexican workers and local governments, though, the debate is less about treaty architecture and more about jobs. If the United States were to quit T-MEC, or let it die in 2036 without renewal, the automatic result would be the loss of the preferential tariffs and legal certainty that now guide cross-border trade. U.S. tariffs and Mexican countermeasures would fall back on general trade rules. That would not end commerce, but it would make every shipment more expensive and every long-term investment harder to justify.
The immediate shock would concentrate in export-heavy regions that have ridden the nearshoring boom, especially along the northern border and in industrial hubs like Monterrey. Plants that produce auto parts, electronics and heavy trucks almost entirely for the U.S. market would have to revisit their business models and, in some cases, their location decisions. Smaller suppliers that depend on a handful of large contracts could be squeezed first if customers delay orders or shift production to plants already inside the United States.
Canada would not escape the turbulence, but Mexico’s exposure is sharper. Mexico is now either the number one or number two market for three-quarters of U.S. export sectors, and the reverse is also true: U.S. demand is the main outlet for a long list of Mexican industries, from cars and auto parts to computers and agricultural products. That mutual dependence is one reason why many trade analysts still believe the three governments will eventually renew T-MEC in 2026. Yet the mere suggestion from the White House that the agreement could be allowed to “expire” or be replaced adds political risk that was not there a year ago.
As Sheinbaum travels to Washington for the World Cup draw and her first face-to-face meeting with Trump since both took office, the message from Mexico is clear. The government wants to move technical disputes toward closure, secure a favorable outcome in the 2026 review and keep the core of North American integration intact. Whether that is enough to cool talk of a Trump T-MEC withdrawal now depends less on Mexico’s willingness to compromise and more on how far the U.S. administration is prepared to go in turning a treaty review into a negotiating weapon.
