Samsung Electro-Mechanics Suwon Plant (Photo courtesy of Samsung Electro-Mechanics)

 

 

[Alpha Biz= Kim Jisun] Samsung Electro-Mechanics has officially canceled its plan to build a camera module plant for automotive electronics in Mexico and has suspended operations of its local production subsidiary. Industry insiders attribute the decision to rising uncertainty over the U.S.–Mexico–Canada Agreement (USMCA) renegotiations, which could jeopardize the current 0% tariff rate on Mexican exports to the United States.



As of June 6, Samsung Electro-Mechanics has removed all references to its Mexican subsidiary from official documents, including quarterly reports and sustainability disclosures. This marks the first known case among major South Korean companies of halting overseas operations due to anticipated changes in U.S. trade policy under former President Donald Trump's influence.



In November 2023, Samsung Electro-Mechanics established a production entity in Querétaro, an industrial hub in central Mexico, with a capital investment of KRW 4.9 billion (approx. USD 3.5 million), aiming to construct a plant dedicated to automotive camera modules. A source in the IT sector explained, “The suspension of the Mexican subsidiary effectively means Samsung Electro-Mechanics has abandoned its plans to establish a new factory there.”



Instead, the company is now exploring alternative locations in Southeast Asia and other regions, where it can minimize tariffs and operational costs while maintaining responsiveness to client demands.

 

 

 

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