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Border

US, Mexico reach tentative deal to replace NAFTA

Aug. 27, 2018
President Trump says discussions with Canada to continue

President Trump announced Aug. 27 the United States and Mexico had agreed to a framework of trade deal that would replace the North America Free Trade Agreement (NAFTA).

Speaking in the Oval Office with Mexican Enrique Peña Nieto on the telephone, Trump said he was eliminated the name “NAFTA” and instead would call this new pact the “United States-Mexico Trade Agreement.”

He suggested a formal signing ceremony would likely take place in November and that negotiations with Canada would continue. It was not clear whether a deal with Canada would be separate, or rolled into the pact with Mexico.

Trump called agreement “among the largest trade deals ever made” and that it is “the right thing for all of us.”

While there not yet many specific details available, American Trucking Associations (ATA) issued a statement praising the development.

“We commend President Trump and his team of negotiators on reaching a tentative agreement with Mexico to modernize NAFTA,” ATA President and CEO Chris Spear said in a statement. “America relies on trucks to carry the bulk of goods that move across our borders, and so our industry knows full well the value and importance of free and fair trade.  We look forward to productive work with our partners in Canada and examining this new agreement in detail to assess how it will affect motor carriers and the flow of commerce between our North American partners.”

It is expected the U.S.-Mexico deal would require 75% of automotive content to be made in North America, up from the current level of 62.5%. It would also require 40% to 45% of auto content to be made by workers earning at least $16 per hour.

During his comments in the Oval Office, Trump said U.S. "farmers will be happy" with the outcome of the trade deal. 

About the Author

Neil Abt

Neil Abt is a former FleetOwner editor who wrote for the publication from 2017 to 2020. He was editorial director from 2018 to 2020.

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