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How One Rules of Origin Rule Reshaped Global Auto Trade
Description
Episode 41 of Global Trade with Fexingo dives into a single rule that transformed the international automobile industry: rules of origin in free trade agreements. Hosts Lucas and Luna unpack the specific case of the USMCA's automotive rules, which require 75% regional value content and 70% steel and aluminum sourcing from North America. They explain how this rule, enforced through production tracing and certification, has reshaped supply chains from Detroit to Mexico, increased compliance costs for manufacturers, and influenced trade flows worth hundreds of billions of dollars. The episode also touches on the broader implications for other FTAs and the ongoing debate over enforcement versus flexibility. A focused, number-driven conversation about how a few paragraphs in a trade agreement can rewrite the geography of car manufacturing.