SANTA TERESA, N.M. – Taiwanese auto parts supplier Hota’s late 2023 announcement of a 30-acre campus in Santa Teresa was a huge economic investment for the border town of about 6,000 residents. On the table: 350 new employees and a $99 million investment into the state, for a combined $4.3 billion economic impact over 10 years.
Two years in, the project’s finish line is vanishing into the horizon.
“A lot of projects are still on hold or postponed or canceled because of the uncertainty of the tariffs and the economic environment,” said Jerry Pacheco, president of the Border Industrial Association, who works to bring companies like Hota to Santa Teresa.
Multi-million dollar investments along the Southern border and thousands of jobs both in the U.S. and in Mexican factories, known as maquiladoras, are at risk as President Donald Trump’s erratic attitude toward tariffs on goods to tackle the national trade deficit with Mexico is paralyzing a long-standing, symbiotic economic relationship.
“It’s like killing an ant with a sledgehammer,” Pacheco said. “That’s not the way you do things.”
The Santa Teresa Port of Entry ranks among the top commercial ports in the country, facilitating over $31 billion in trade annually. (Photo by Sandra Sadek)
Rippling cross-border effects
In Juarez, there are now 45,000 fewer employees on maquiladora payrolls in January 2025 compared to January 2023. This industry accounts for over 60% of all payrolls in Juarez.
Maquiladoras are foreign-run factories that produce goods to export. These factories significantly expanded their presence across Mexico in the 1990s, after deals like the North American Free Trade Agreement (NAFTA) removed trade barriers with the U.S. and Canada.
Major U.S. companies with maquiladoras in Mexico include automakers like General Motors and Ford; IT companies like Foxconn and Intel; and textile manufacturers like Levi’s and Dickies.
Data currently shows the number of maquiladoras still operating in Juarez has remained steady so far, but “it wouldn’t surprise me if a lot of maquiladora factories have closed down,” said Tom Fullerton, professor of economics and finance at the University of Texas at El Paso.
“If plants are closing down, it’s probably been in 2025 and still hadn’t been fully documented,” Fullerton said. “People like me won’t be able to confirm that until later this year, maybe in six months or so.”
On the other side of the border, demand for speculative warehouses – large spaces to house Mexican goods arriving through the nearby Santa Teresa Port of Entry – outpaced the supply, Pacheco said. Now, just as supply is finally catching up, that progress risks being lost with the new tariff policies.
In April, the vacancy rate in the Borderplex was 10%, slightly above the average 9.5% rate. The Borderplex region includes Santa Teresa and the three-city metro of Ciudad Juarez, Mexico; El Paso, Texas; and Las Cruces, N.M.
While vacancy means the warehouse market is no longer so tight, this higher-than-average rate is actually twofold.
“The threat of tariffs by President Trump has caused many companies not to pull the trigger and sign a five-year lease to go into a big space like that,” Pacheco said.
Should maquiladoras shut down, the impact would be major and felt by both the U.S. and Mexican economies, which have grown ever more intertwined over the years thanks to various free trade agreements.
“Cross-border manufacturing integration in the Western Hemisphere has allowed many US corporations to survive,” Fullerton said. “It’s helped U.S. consumers because it increased the types of goods available.”
Ciudad Juarez sits on the Rio Grande and is an important economic center in the Mexican state of Chihuahua, as the home of the largest share of maquiladoras, or factories, in the country due to its proximity to the United States. (Photo by Sandra Sadek)
Pressured Migration
Maquiladoras are set up so that they are easy to close and reopen quickly based on the whims of international trade. That responsiveness could leave workers, often women, financially vulnerable and bearing the brunt of the impact.
According to Mexico’s National Survey of Occupation and Employment, women made up over 40% of the manufacturing labor force by the end of 2024. In the automotive industry, that number is 46%.
Women have for many years been a main source of labor, both in the U.S. and now in Mexican factories, working on highly skilled tasks that require manual dexterity.
In the 1990s, Mexico’s labor gain was Texas’s loss as cities like El Paso, dubbed “The Blue Jeans Capital of the World,” lost their status as a major apparel factory hub in the 1970s and 1980s to free trade agreements.
“[The women] were adept – I mean, the eye-hand coordination is why manufacturers came here,” said Gary Williams, local historian and director of the El Paso History Museum Foundation.
Shifts in free trade in the 1990s drastically affected the U.S. manufacturing industry as companies relocated their shops to Mexico, where labor was cheaper, and labor laws were less stringent.
As companies jumped the border, “the Southwest lost thousands of garment jobs,” Williams said. The shutdown of a Levi’s factory in San Antonio in 1990 to relocate to Costa Rica left more than 1,000 people unemployed.
“The impact in the ’90s was people lost their way to feed their family and make a living,” Williams said, noting that it was nonprofit organizations that stepped up at the time to help female workers transition to other jobs.
Today, with maquiladoras threatening to close in response to U.S. economic policies, a similar outcome could take place in Juarez and other Mexican cities that rely on these factories as major employers.
“Many people are at the border only because they came for the steady jobs in the factories in the maquiladoras,” said Elvira Rosales Arriola, co-founder of Women on the Border, noting that climate change has hindered many workers’ original livelihood as farmers.
If these steady jobs disappear, these workers are “going to be like the migrants that came from other countries and are stuck at the border,” Arriola said. “Now they’re competing with everybody else who is trying to get a mouthful of food.”
The shuttering of maquiladoras and potential loss of Ciudad Juarez’s economic vitality will increase pressures to migrate to the U.S. and act counterproductively to the White House’s stance on immigration, experts say.
“It would increase migration, increase cost,” Fullerton said. “It would affect the entire global supply chain. It would just be a bad idea overall.”
As the fate of free trade with Mexico remains unknown and risks upending decades of the status quo, those whose work relies on cross-border trade remain skeptical of what’s to come.
“Business and industry need some semblance of stability in order to strategically plan and make good purchasing and production decisions,” Pacheco said. “It’s a gamble, and companies don’t like to gamble.”