Issue #60: USMCA on the Clock: What Renegotiation Could Mean for Cross-Border Freight

Trump’s Commerce Secretary says USMCA is next. For freight people, the real changes will be capacity-driven.

It’s happening again. Or at least, it sounds like it is.

Last week, President Trump said he would “absolutely” renegotiate the USMCA if elected. That headline alone kicked off a wave of speculation, panic-posting, and more than a few questions from freight folks wondering: Wait, does this mean new tariffs are coming?

Let’s clear this up: yes, the USMCA is up for review. That’s not political spin — it was built that way. A six-year sunset review is baked into the agreement, and 2026 is the first official checkpoint. The U.S., Mexico, and Canada is headed back to the table now.

But this isn’t NAFTA 2.0 all over again. We’re not going to see massive shifts in freight flows or a top-to-bottom rewrite of trade policy. What we’re likely to see is a mix of incremental rule changes, more enforcement, and political theater — all branded as a “big win” for the U.S.

Meanwhile, cross-border trade between the U.S., Mexico, and Canada? It’ll probably keep growing.

Here’s what you need to know.

The Agreement Was Built for This Moment

The USMCA officially replaced NAFTA in July 2020. It wasn’t a radical overhaul — it kept the duty-free trade structure intact — but it tightened up a few key areas:

• Stricter rules of origin for autos and parts

• Modernized digital trade protections

• More enforceable labor and environmental provisions

• Updated IP and pharmaceutical standards

And it added a sunset clause — a built-in mechanism requiring all three countries to review and reauthorize the agreement every six years.

So when Trump says he’s planning to renegotiate it in 2026… he’s not blowing it up. He’s just showing up for a meeting that was already on the calendar.

What Changed in 2020: Tighter, Not Transformational

The most impactful USMCA changes weren’t about what could be traded — they were about how much of it needed to be sourced from North America.

1. Auto Content Rules

The most high-profile shift was the jump in required North American content for vehicles and parts:

• Under NAFTA: 62.5%

• Under USMCA: 75%

Some labor wage requirements were added too. Most OEMs and Tier 1s adapted, with more documentation and sourcing audits, but few major supply chain shifts.

2. Customs & Digital Trade Modernization

Digitization of customs paperwork and streamlined small-parcel thresholds helped e-commerce and LTL more than truckload. Still, less paper and faster clearance is a net positive.

3. Labor & Environmental Provisions

These gave the U.S. more teeth in enforcement. Important for compliance teams, but not freight-altering.

What’s Likely on the Table in 2026

• Auto origin rules: Could go from 75% to 80%

• Stricter enforcement: More audits, compliance checks, and country-of-origin documentation

• TRQ disputes: Especially dairy and poultry

• More Section 232 tariffs: Covering metals, energy, semiconductors, etc.

• Political brinkmanship: Suspension threats, tariff deadlines, and exit talk used as leverage

Commodities in the Crosshairs

President Trump’s strategy is tariff-first. His approach to the USMCA includes:

• A proposed 25% blanket tariff on Mexican and Canadian imports

• Tariff threats tied to border security, fentanyl, and perceived trade imbalances

• Use of “national emergency” declarations to fast-track changes

Here are the commodities most at risk:

Agriculture & Food

• Examples: Avocados, tomatoes, cheese, grains, pork

• Why at risk: High cross-border reliance, tariff-rate quotas (TRQs), potential retaliation

• Potential impact: 15–25% increase in consumer prices, spoilage risk, supply chain stress

Automotive

• Examples: Vehicles, engines, transmissions, auto parts

• Why at risk: 70% of U.S. auto parts are sourced from Mexico or Canada; highly integrated “just-in-time” supply chains

• Potential impact: $2,000–$5,000 vehicle price hikes, U.S. plant slowdowns, potential 100,000+ job losses

Energy

• Examples: Crude oil, natural gas, refined petroleum

• Why at risk: Canada is the largest supplier of oil to the U.S.; tariffs could disrupt regional energy flows

• Potential impact: Fuel and heating cost increases, pressure on refineries and exporters

Metals & Minerals

• Examples: Steel, aluminum, copper, rare earths

• Why at risk: Previous and proposed tariffs (up to 50%); essential to construction and industrial supply chains

• Potential impact: Higher costs for U.S. manufacturers, retaliation on U.S. exports, sourcing instability

Electronics & Machinery

• Examples: Computers, appliances, industrial components

• Why at risk: Many are assembled in Mexico; supply chains depend on low-cost, cross-border trucking

• Potential impact: Delays in tech sectors, increased costs for consumer goods, potential offshoring reversal

Goods Moved by Truck: The Real Impact Zone

Cross-border trucking handles over $1.8 trillion in U.S. trade with Mexico and Canada. That’s the frontline for tariff risk.

Most at-risk truck freight:

• Perishables: Avocados, berries, tomatoes from Mexico — 50-60% of U.S. fresh produce imports

• Automotive: Just-in-time loads from maquiladoras; even small delays ripple upstream

• Consumer Goods: Electronics, packaged food, beverages — high-volume, cost-sensitive

• Industrial Inputs: Steel coils, chemicals, refined fuels

Since USMCA’s implementation, truck freight value on these commodities is up 43%. Renegotiation risks like a 25% tariff or tighter TRQs could spike freight rates, force mode shifts, and cause importers to front-load inventory.

So What Does This Mean for Freight?

Short Term:

• Expect headlines, posturing, and pre-2026 stockpiling

• Brokers, carriers, and compliance teams need to watch enforcement language

Medium Term:

• More documentation and border friction in key categories

• Delays at ports of entry, especially LTL and perishable goods

• Some shifts in sourcing as companies respond to cost pressure

Long Term:

Even with noise and political heat, freight will likely grow:

• Nearshoring momentum continues

• U.S. buyers want diversified sourcing and shorter transit times

• Mexico and Canada remain the U.S.’s most stable, integrated trade partners

The Freight Outlook: More Trucks, Not Fewer

If the USMCA gets updated in 2026, it will likely be framed as a political win for the U.S. But that doesn’t mean freight flows slow down.

We saw this in 2020: the rules got stricter, the paperwork got thicker, but trade kept growing.

This time, it may even accelerate. Companies want stability, predictability, and access to nearby suppliers. If the revised deal preserves those incentives, we could see:

• Even more perishable product moved by truck from Mexico

• Higher auto part volumes due to greater North American content compliance

• Increased exports of U.S. ag and industrial products into Canada and Mexico

The trucks will keep rolling. And in the long run, there might be even more of them.

Want to talk about how to navigate these changes? Reach out. Or better yet: keep quoting and covering your cross-border loads. The freight isn’t going anywhere.