U.S., Mexico launch talks over trade deal shielding HVAC products from tariffs

Ahead of a key review scheduled for July, the U.S. and Mexico this week began preliminary talks over the future of their North American trade agreement with Canada, which has insulated the HVAC industry amid the tariff volatility of the past year.

Catch up quick: In March 2025, President Trump issued a tariff exemption for certain products covered under the U.S.-Mexico-Canada Agreement (USMCA), a trade pact that took effect in July 2020 during his first term, including a range of HVAC and water heating products. 

• A clause in the agreement requires a formal review every six years, allowing the countries to decide whether to continue, renegotiate, or end it altogether. 

What’s happening: Trump, in recent months, has made dismissive comments about the USMCA. “There’s no real advantage to it,” he said during a January speech in Detroit. “It’s irrelevant.”

• Meanwhile, it’s “not a secret” the president has considered nixing the deal, U.S. Trade Rep. Jamieson Greer told Bloomberg last month. 

Why it matters: Mexico is the U.S. HVAC industry’s largest foreign supplier, representing roughly 40 percent of the industry’s manufacturing capacity and accounting for over $10 billion of imports in 2024, per HARDI.

• While the president has imposed, walked back, and re-imposed a swath of global tariffs over the past 12 months, the USMCA exemptions have remained in place, shielding the industry from the brunt of tariff impacts. 

The watch item: Despite Trump’s comments, it remains unclear whether the U.S. plans to target specific exemptions — or industries — as part of the review, or focus instead on broader, structural elements of the agreement. 

• Meanwhile, U.S. business groups have advocated for improvements to the USMCA; however, it has been “successful to a degree” and has “broad support,” Greer acknowledged in a December statement. 
• A White House spokesperson didn’t return Homepros’ request for comment. 

Looking ahead: Officials are now expected to “meet regularly” ahead of the July review, the Office of the U.S. Trade Rep. said in a press release.