You don't need to look far to find analyses of how tariffs will impact various industries and the broader economy. Focusing on Mexico, it's clear auto OEMs and suppliers are one of the most impacted industries.
Recently, the FT highlighted how Trump’s proposed tariffs on Mexico could result in manufacturers – such as those for auto components – may move production to countries like Vietnam.
Concurrently, the Economist illustrated how Tesla’s production of a gigafactory in Mexico remains in limbo, potentially due to concerns from Trump tariffs.
To dig a little bit deeper, let’s find a list of auto supply chain companies for which tariffs could have a meaningful impact on the stock. Using Portrait’s screening capabilities, here are a few highlights.
Adient plc - Mexico Tariff Exposure Analysis
Manufacturing Footprint & Revenue Exposure
Adient maintains a substantial manufacturing presence in Mexico with 18 total facilities, comprising 8 owned manufacturing/assembly facilities and 10 leased manufacturing/assembly facilities (ADNT 10-K FY 2024).
The company's Mexico operations generated $2.634 billion in revenue during fiscal 2024, relatively stable from $2.661 billion in fiscal 2023, representing a significant portion of their overall business (ADNT 10-K FY 2024).
The Mexico footprint includes both cut-and-sew operations and metal manufacturing facilities, with some metal operations specifically localized to Mexico in response to previous China tariffs (Adient plc, Q1 2025 Earnings Call).
Direct Management Commentary on Tariff Risk
Management has explicitly stated they cannot absorb tariffs at either a 25% or 10% level on their P&L and has begun "meaningful dialogue" with customers about passing through these costs (Adient plc, Q1 2025 Earnings Call).
The company has established specific action plans for each customer regarding potential Mexico tariffs and is managing the situation on an "almost hourly basis" (Adient plc, Q1 2025 Earnings Call).
For context, management noted that with previous tariffs in 2017, they successfully reduced exposure from $40-60 million gross to single-digit millions net over a 12-16 month period, though they acknowledge any Mexico tariff response would need to be executed more quickly (Adient plc, Q1 2025 Earnings Call).
GM's Exposure to Potential US-Mexico Tariffs
Manufacturing Footprint & Scale
GM maintains significant manufacturing operations in Mexico, with Mexican assets representing approximately 12% of the company's total long-lived assets globally (GM 10-K FY 2024, GM 10-K FY 2023). This makes Mexico one of GM's largest manufacturing bases outside the United States.
The company operates multiple facilities in Mexico, including the strategically important Ramos manufacturing facility, which has flexibility to produce both ICE vehicles and EVs (GM Q4 2023). GM has confirmed they manufacture trucks in Mexico, though specific production volumes are not disclosed (GM Q4 2024).
Supply Chain Integration
GM acknowledges having "a good chunk of the supply base" in Mexico, indicating significant supply chain exposure beyond just final assembly operations (GM UBS Conference).
The company operates a "just-in-time" manufacturing process that relies heavily on timely cross-border component deliveries, making them particularly sensitive to any trade disruptions or tariffs affecting US-Mexico trade flows (GM 10-K FY 2024).
Management Commentary & Mitigation Planning
GM's management has been direct in acknowledging their exposure, stating "there's no hiding behind the footprint for GM or really even the industry at large" (GM UBS Conference).
The company has developed multiple contingency plans for potential tariffs, including:
The ability to shift some truck production from Mexico to existing U.S. facilities
Flexibility to redirect Mexico-produced vehicles to global markets while using U.S. plants for domestic supply
Implementation of various "no cost or low cost" supply chain and logistics adjustments (GM Q4 2024)
Management is deliberately avoiding overreaction to potential tariffs, indicating they will:
Evaluate both short-term and longer-term scenarios
Catalog which manufacturing/sourcing changes could be made with "low cost, low friction" versus those requiring significant investment
Potentially absorb some short-term costs rather than make dramatic changes that could prove inefficient long-term (GM UBS Conference)
Jabil Inc. - Mexico Tariff Exposure Analysis
Manufacturing Footprint & Scale
Jabil maintains substantial manufacturing operations in Mexico through facilities in Chihuahua, Guadalajara, and Monterrey (JBL 10-K FY 2024). While specific Mexico figures are not broken out, these operations are part of Jabil's Americas segment which encompasses approximately 13 million square feet of manufacturing space and employs roughly 48,000 people (JBL 10-K FY 2024).
Management's Strategic Positioning
Management has indicated that historically, tariff-related costs have generally been treated as pass-through expenses rather than direct margin impacts (Jabil Inc., Q1 2025 Earnings Call).
The company believes it is well-positioned to handle potential tariffs due to:
Demonstrated ability to rapidly establish new manufacturing facilities, citing examples of setting up operations in under 6 months (Jabil Inc., Q1 2025 Earnings Call)
The company explicitly acknowledges several risks related to potential tariffs:
Direct cost impacts on components, raw materials, and finished product movement (JBL 10-K FY 2024)
Potential customer decisions to relocate manufacturing, requiring significant management attention and facility development costs (JBL 10-K FY 2024)
Operational challenges specific to Mexico including rising labor costs, potential labor unrest, and political/economic instability (JBL 10-K FY 2024)
JBL struck me as interesting. Glancing at their Portrait case study, they appeared to be an “AI-winner” due to another arm of their business serving the data center market.
Strong Q1 performance driven by AI-related demand:
Jabil reported Q1 core EPS of $2.00, beating FactSet consensus of $1.88, with revenue of $6.99B surpassing expectations of $6.61B:
Core operating income came in at $347M, above FactSet estimates of $330.1M.
The outperformance was achieved despite a 10-20 basis point impact from hurricane-related disruptions.
The strong results were primarily driven by incremental strength in Cloud, Data Center Infrastructure, and Digital Commerce end-markets:
Intelligent Infrastructure segment revenue grew 5% year-over-year to $2.5B, fueled by strong demand in AI-related cloud, data center infrastructure, and capital equipment markets.
Connected Living and Digital Commerce segment saw 12% year-over-year growth (excluding the mobility divestiture), reflecting strength in digital commerce and warehouse automation.
Management highlighted the growing importance of AI in driving demand across multiple areas:
The company increased its AI-related revenue forecast for FY2025 from $5-6B to $6.5B.
CEO Mike Dastoor noted that the rise of AI is driving demand for semiconductor fabrication and test equipment, which is expected to continue throughout FY2025 and beyond.
The company is seeing increased demand for custom AI-driven GPU rack integration business from its largest hyperscaler customer.
Before spending more time on the name, I asked Portrait put together a short report to quickly frame JBL’s exposure to 25% Mexican tariffs. While a first-pass analysis, the following seems like a good starting point.
Unmitigated impact
Using assumptions from the 10-K and various disclosures
This is of course just a first pass analysis and ignores second and third order effects, but a helpful starting point to frame up the impact of tariffs.
To dig deeper into JBL, or replicate this analysis for other companies / industries and rank who is most exposed to tariffs, head over to Portrait today!
