Texas is a manufacturing powerhouse. However, while Texas hit a record high for total jobs in May, manufacturing output slowed down. As renegotiation of the U.S.-Mexico-Canada Agreement begins, this trend could worsen as thousands of Texas manufacturing jobs hang in the balance.
The aluminum industry in particular has an outsized impact on the state’s manufacturing jobs with 14 aluminum extruders in Texas alone. For companies like mine, the next few months will be decisive in determining if we get a fair USMCA deal or are crushed by a flood of unfair imports once again.
As the president of Tower Extrusions, an aluminum extruder in Young County, I have a firsthand understanding of the risks involved in a bad USMCA deal. I walk the plant floor daily, speaking to workers who worry a renewed USMCA could send their jobs across the border.
In June, I was asked to join a delegation of industry leaders for a USMCA roundtable in Mexico City where I emphasized the importance of a level playing field that keeps these jobs here at home.
In its current form, China can treat the USMCA as a backdoor to duty-free U.S. market access. Chinese companies, backed by Chinese Communist Party subsidies export aluminum to Mexico at artificially low prices, where it undergoes minimal processing before entering the U.S. market as a “Made in Mexico” product under the USMCA.
This form of foreign trade cheating, known as “transshipment,” can happen because the USMCA has no aluminum content requirement. This loophole allows importers to bring in products from Mexico and Canada duty-free even though they contain 100% Chinese aluminum.
This is why any final agreement must include a minimum U.S. aluminum content requirement. By requiring aluminum extrusions to contain a specific amount of U.S. aluminum to be traded into the U.S. under the USMCA, China will not be able to engage in deceptive transshipment practices so easily.
To fully close the China loophole, the 50% tariff on aluminum must be enforced without exceptions carved out by a renewed USMCA. Aluminum tariff concessions tied to the USMCA’s establishment in 2020 led to a 46% increase in aluminum imports from Mexico between 2021 and 2024.
This flood of imports, largely originating from China, devastated the American aluminum industry, resulting in plant closures and layoffs in Texas and across the country.
There are also national security implications tied to this tariff. Almost every piece of military equipment requires aluminum in its assembly. Aluminum keeps our fighter jets light enough to fly, our naval ships efficient on the water and our combat vehicles armored on land.
Without fair competition, we risk losing our ability to produce aluminum extrusions here at home. How can the United States defend itself if the aluminum we rely on to protect our troops is exclusively produced by a foreign adversary?
Mexico will argue that exemptions are safe now because it has finally established a system to monitor aluminum imports. This claim should reassure no one. This system requires no proof of origin, sets no limits on import surges into the U.S. and excludes Mexico’s duty-free import programs.
Granting exemptions outsources enforcement of our own trade borders to Mexico and Canada while trusting a deeply flawed monitoring system.
We cannot afford to repeat mistakes of the past even as Mexico and Canada pressure the Trump Administration to provide tariff carve-outs tied to a renewed USMCA. This time, we must put American workers first by remaining vigilant in our tariff enforcement. No exemptions, no exceptions.
When China is allowed to cheat, thousands of hardworking Texans pay the price. As USMCA negotiations begin, now is the time to stop the bleeding. This is not a red or blue issue, but rather an opportunity to fight for the future of manufacturing communities in Texas and beyond.
Mark McClelland is the president of Tower Extrusions in Olney and has been with the company for nearly 40 years.
This article originally appeared on San Angelo Standard-Times: When China cheats, Texans pay the price | Opinion
Reporting by Mark McClelland, President of Tower Extrusions / San Angelo Standard-Times
USA TODAY Network via Reuters Connect
By Mark McClelland, President of Tower Extrusions | USA TODAY Network
