Sourcing Shift Insights:
Latin America (LATAM)
Tariff Impacts Reshape LATAM’s Sourcing Momentum
Trade wars and global disruptions have rewritten the supply chain rulebook. The Sourcing-in-LATAM data for 2025 shows how quickly LATAM has capitalized: now delivering one-quarter of US/Canada technology imports and an expanding share of fast-turn consumer goods.
Mexico’s ascent, especially in technology and hard goods—fueled by tariff-neutral access through the USMCA—has attracted brands seeking cost certainty and stability. Central America rides a similar wave in softlines, backed by robust trade preferences. Tariff and supply chain resiliency isn’t just an operational win—it’s now essential for protecting margins and fast response in the volatile global market
Executive Summary
Over the past year, as brands confronted supply shocks, LATAM became a preferred destination for diversified sourcing. Mexico, powered by its proximity, infrastructure, and duty relief, now dominates US-bound consumer and technology products. Central America and the Caribbean have become the backbone for quick-turn apparel and medtech. With year-on-year growth and structural cost advantages, LATAM’s rise is cementing its place in the future of global supply chains.
Key Highlights:
- Tariff volatility and regulatory changes drive near-shoring and have rapidly pushed sourcing from Asia to LATAM, particularly towards Mexico and Central America.
- LATAM now supplies 7% of US/Canada consumer goods imports and 25% of tech imports.
- Mexico leads with 97% of US technology product imports and 89% of hard goods.
- Central America gains in softlines/apparel through trade preferences and competitive costs.
- Sectors seeing the strongest tariff-driven shifts: hard goods, electronics, automotive, medtech.
- Landed cost, including tariffs and freight, now drives major buyer decisions for shifts to LATAM.
Q1-25 USA Imports from LATAM for both consumer and technology products:
Key Takeaways:
LATAM’s profile is surging: Supplying 7% of US/Canada’s consumer goods and 25% of technology imports.
Mexico is foundational: Delivers 66% of US consumer goods imports, and 97% of US technology products imports, as well Mexico also accounts for 98% of Toys Juvenile Products, 97% of Electrical, and 71% of MedTech Products for US Imports
Central America and the Caribbean are vital for apparel, softlines, and medical devices.
Growth is robust: Double-digit CAGR in Mexico’s tech, automotive, and healthcare sectors.
