Autobayng News Team
Auto stocks fell up to 2 per cent on Monday as investors positioned for potential damage from Mexico’s sweeping new tariff regime on imported goods, with pressure building in some of India’s most export‑exposed auto names. The Nifty Auto index slipped over 1 per cent to 27,477.85, while shares of Bharat Forge, Samvardhana Motherson International, Mahindra & Mahindra, Eicher Motors and Hero MotoCorp declined between 1 per cent and 2 per cent, leaving portfolios exposed to autos nursing losses at the start of the week.Mexico’s Senate has approved higher tariffs on about 1,400 products imported from countries that do not have a free trade agreement with Mexico, with the new duties taking effect from 1 January 2026. JM Financial noted that these tariffs, ranging from 5 per cent to as much as 50 per cent, will cover a broad swathe of products, including automobiles, auto components, steel, aluminium, textiles and plastics.According to JM Financial, India’s exports to Mexico were $5.7 billion in FY25, or 1.3 per cent of India’s total exports, making Mexico the country’s 21st‑largest export destination. The autos and auto components alone accounted for 33.8 per cent of exports to Mexico in FY25, underlining why traders have turned cautious on auto stocks as they reassess the sector’s exposure to Mexican demand and trade policy risk.Autos and aluminium most exposed
In its strategy report, JM Financial pointed out that Mexico has “consistently ranked as the 2nd largest destination” for India’s auto and auto component exports, with shipments of $1.9 billion in FY25, representing 8.6 per cent of the segment’s total exports. The brokerage said this concentration leaves Indian auto exporters vulnerable to higher tariffs on vehicles and parts, which could weigh on margins and volumes for companies plugged into Mexican and North American supply chains.
JM Financial also identified aluminium as a key pressure point under the new regime. The brokerage said Mexico was the 4th‑largest export destination for Indian aluminium in FY25, with exports of $0.4 billion, or 5.6 per cent of India’s aluminium exports, now facing higher duties. While Monday’s selling was most visible in auto counters, the brokerage suggested that primary aluminium producers and downstream players will also have to recalibrate contracts and market mix as tariffs rise.Wider export links, but smaller shares
Beyond autos and aluminium, JM Financial’s analysis showed that Mexico is also an outlet for Indian exports of electronics, machinery, organic chemicals and iron and steel, though with a smaller footprint. Electronics exports to Mexico were $0.7 billion in FY25, equivalent to 1.6 per cent of India’s electronics exports, while machinery exports to Mexico accounted for 1.6 per cent of machinery exports, organic chemicals 1.9 per cent and iron and steel 1.6 per cent.
For listed companies in these categories, Mexico represents a modest slice of overall export flows even as it remains an important destination for certain product lines.
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