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The risks of Trump tariffs encapsulated in a car key [Video]

Categories
Canadian Economy and Markets

They unlock vehicles with just the touch of a button, but the manufacturing of electronic car keys is anything but simple, illustrating the potential complexities and costs of US President Donald Trump’s threatened tariffs.

The production of key fobs used by millions every day is an example of the free trade benefits from the United States-Mexico-Canada Agreement (USMCA) as it simplifies manufacturing and supply chains.

The small, handheld remote controls are assembled in Mexico, but they can cross borders in North America several times before being finished, like countless other auto parts and products.

Here is a description of the manufacturing process at one factory in the western Mexico city of Guadalajara, as well as the implications of potential tariffs.

– Process starts in China –

One of the main parts of key fobs is the printed circuit board (PCB), which comes from China and contains the components that activate functions such as unlocking a car.

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