Representatives from the U.S. and Mexico tentatively struck a deal Monday to revise key portions of the North American Free Trade Agreement, possibly bringing to an end monthslong barbs between the two countries about fair trade and escalating tariff threats.
According to the reports, provisions of the deal haven't yet been fully agreed upon but the two countries could significantly change how automakers build cars within the NAFTA zone.
The new deal could require automakers to source 75 percent of new-car parts from within the NAFTA zone, up from 62.5 percent under the last agreement. Provisions of the new agreement Monday are likely to include new requirements for automakers' infotainment systems and parts that were previously exempt from the final composition list under the old agreement.
Under the new deal, the cars also will be required to source more steel and aluminum locally and would require that a certain proportion of the workers that built the car be paid more than $16 per hour.
The New York Times reported that Canada was largely absent from the latest round of negotiations between the U.S. and Mexico, and would rejoin negotiations after the U.S. and Mexico hammered out a bilateral deal.
Any agreement would require congressional approval in the U.S. along with approvals from Mexico's incoming president and officials from Canada.