Car imports make up the entire Mexico/USA trade deficit
If you take away those shipments, President-elect Donald Trump's dream would come true: The U.S. wouldn't have a trade deficit with Mexico.
So, if all things remain the same and car imports are taken away, the trade deficit with Mexico would disappear.
"Cars are by far the largest export from Mexico to the U.S. — without them, the [Mexican] trade surplus with the U.S. vanishes," says Neil Shearing, chief emerging markets economist at Capital Economics, a research firm.
Indeed, cars beat the next top four import categories — electronic parts, food, computers and TVs — by a mile. Even if you add the value of those four categories together, they still fall short of the value of all the cars brought across the border, according to figures compiled by Capital Economics. Their value would total a little over $71 billion.
No wonder, Donald Trump has targeted automakers.
"If you're going to make a fuss about something, you want to make a fuss about something that's going to make a difference," says Chris Rogers, research analyst at Panjiva, a global trade research firm.
Trump has warned that car companies like Toyota (TM) and GM (GM) will face a "big border tax" if they don't move jobs and production back to the U.S. from Mexico.
During his campaign, Trump often compared America's trade deficit to a company losing money.
"We're losing a tremendous amount of money, according to many stats, $800 billion a year on trade," Trump told the New York Times during his campaign. Patrick Gillespie/CNN Money