From molten steel in Minas Gerais to assembly lines in the Valley of Mexico, the continent’s industrial map is being redrawn under the pressure of new U.S. tariffs. Today, Brazilian companies are expanding their presence in Mexico to navigate the ongoing trade conflict. 

The first movers were Brazilian steel and manufacturing companies, which have been adjusting their footprint to maintain access to the North American market. Among them are WEG and Gerdau, two industrial giants planning to invest around USD 900 million in Mexico. 

The trigger was political. Between July and September 2025, the White House raised tariffs on Brazilian steel and other products from 10–25% to 50%, citing national security and trade reciprocity. Only strategic sectors — such as aerospace, energy, fertilizers, and basic minerals — were exempted. 

For now, the impact has yet to be seen on a large scale, though that could soon change. Currently, Brazilian companies occupy roughly one in every two hundred square meters across Mexico’s main industrial regions — the North, Central, and Bajío zones. Their presence, however, continues to grow. 

According to data from SiiLA, between the third quarter of 2024 and the same period in 2025, the gross leasable area occupied by Brazilian firms increased by 3% — a slower pace than the 7% recorded the previous year, when the sector had anticipated tariff revisions on steel and aluminum. During this period, WEG expanded its presence in central Mexico by more than 24,000 m² to strengthen its production capacity aimed at the North American market. 

This reshaping is driven not only by tariffs but also by Brazil’s crucial role in the continental production chain. Both Mexico and the United States depend heavily on Brazilian industry — the former for imports of vehicles and auto parts, steel inputs, cattle, and agricultural products; the latter for aerospace goods and agribusiness exports such as sugar, coffee, ethanol, juices, and fruits, as well as semi-manufactured iron and steel and strategic minerals like asbestos, alumina, clay, and niobium — all essential to the metallurgical, technology, and defense industries. 

This interdependence explains why, even amid tariff tensions and commercial uncertainty that have slowed some capital flows, Brazilian companies are choosing to move closer rather than further away. In July, the Brazil–Mexico Chamber of Commerce confirmed that at least 42 companies plan to enter the Mexican market for the first time. The trend isn’t new — on average, for every Mexican company investing in Brazil, 21 Brazilian firms seek to establish themselves in Mexico. Still, the movement reinforces the country’s role as an industrial hub driven by both domestic demand and export capacity. 

“The trade relationship among Mexico, Brazil, and the United States has always been triangular,” explains José Ignacio Martínez, coordinator of the Laboratory for Trade, Economy, and Business Analysis. 

This dynamic operates across shared production chains — especially in the steel and automotive sectors — where assembly takes place in one country and finishing in another, depending on what’s most cost-effective for production, transportation, and export at any given moment. 

In this balance, “while tariffs might hit Mexico, logistical costs would burden Brazil. That’s where a major opportunity for trade creation between the two countries could emerge.” In fact, “paradoxically, the tariffs imposed by Trump on both Mexico and Brazil could foster strong complementarity between their economies and open the door to a common strategy for the Global South.” 

Today, about 716 Brazilian companies operate in Mexico. According to Mexico’s Secretariat of Economy, between mid-2024 and 2025, the number of entities with active Brazilian foreign direct investment (FDI) grew 22%, surpassing 650. 

However, this increase didn’t translate into more capital but rather into structural expansion within existing operations. Over the same period, total investment fell 41% year over year, mainly due to fewer new projects and reduced profit reinvestment. 

The gap suggests that many newly registered entities weren’t newcomers but subsidiaries, affiliates, or operating vehicles of already established groups that reorganized their footprint — including through mergers — without major cash outflows. This points to more of an operational reengineering than a speculative move. Long-term trends reinforce this view: over the past five years, Brazilian FDI in Mexico has grown at a compound annual rate of 3.6%, driven mainly by reinvestment from existing companies. 

Even so, strategic sectors such as basic chemicals and electrical equipment tied to the aerospace industry — exempt from the harshest tariffs — doubled their investment volume compared to the previous year. This reveals where the real opportunity lies, in a context where Brazilian exports to Mexico and the U.S. continue to grow at real annual rates of 5% and 8%, respectively, showing that beyond political noise, the structural demand for certain goods remains strong and will continue to deepen the productive integration between Mexico, Brazil, and the United States.