A decline in industrial activity in Mexico that began months ago continued in September, according to official data.
The national statistics agency INEGI reported on Tuesday that industrial activity declined 0.4% in September compared to August and 3.3% in annual seasonally-adjusted terms.
It was the fourth consecutive month-over-month decline and the seventh consecutive downturn in annual terms. In month-over-month terms, industrial activity has only increased in two months this year: February (3%) and May (0.5%).
INEGI’s industrial activity data measures the output of Mexico’s manufacturing, mining, construction and electricity/water/gas sectors.
The construction sector recorded the largest declines in both month-over-month and annual terms in September. Activity in that sector declined 2.5% in September compared to August and 7.2% compared to the same month of 2024.
Activity in the manufacturing sector — which is easily the largest contributor to Mexico’s overall industrial output — increased 0.2% in September compared to August, but declined 2.3% in annual terms. The year-over-year decline was the largest in more than five years.
Activity in the mining sector increased 0.7% in September compared to August, but declined 3.2% in annual terms.
Activity in the combined electricity, water and gas sector increased 0.4% in September compared to the previous month, but declined 0.2% annually.
Industrial activity declined 1.8% in the first 9 months of 2025
INEGI also reported that industrial activity in Mexico declined 1.8% in the first nine months of the year compared to the same period of 2024. It was the first decline in the January-September period since 2020, when the COVID pandemic and associated restrictions ravaged the Mexican economy, including its industrial sectors.
Mexico Industrial Production
Source: tradingeconomics.com
If the 11.4% decline in industrial activity in the first nine months of 2020 is excluded, the downturn between January and September of 2025 is the worst result since 2009.
In the first nine months of 2025, activity in the mining sector fell 8.4% annually, while the construction sector recorded a 2.7% downturn. Within the construction sector, activity related to civil engineering projects declined 26.7% compared to the first nine months of 2024. The significant decline is closely related to a reduction in government spending on infrastructure projects.
Activity in the combined electricity, water and gas sector declined 1.1% annually between January and September, while the manufacturing sector recorded a 0.5% downturn.
Within the manufacturing sector, activity related to the production of “transport equipment,” including vehicles, declined 4.9% annually in the first nine months of the year.
Since early April, light vehicles made in Mexico have faced a tariff when exported to the United States. The U.S. imposed a tariff on medium- and heavy-duty trucks this month, but U.S. content in such vehicles made in Mexico is exempt from the duty, as is the case with U.S. content in light vehicles.
A slowing economy
The 1.8% year-over-year decline in industrial activity between January and September coincides with a broader economic slowdown in Mexico. The economy grew just 0.5% annually in the first nine months of the year, according to an estimate based on official data from Gabriela Siller, director of economic analysis at Banco Base.
Mexico’s economy shrinks 0.3% in Q3 as manufacturing industry weighs on growth
With regard to the outlook for industrial activity in Mexico, and economic activity more broadly, “the balance of risks remains tilted to the upside,” according to economists with the Monex financial group.
In a report, Janneth Quiroz and Rosa Rubio cited “the lack of sustained momentum in the industrial sector, the low levels of productive investment (machinery and equipment), and primarily trade tensions with the United States” among the factors that “could limit economic growth” in late 2025.
With reports from Milenio and El Economista
