Mexico’s fashion e-commerce market is expanding rapidly. However, the country’s domestic apparel industry faces growing pressure from imports, rising production costs and increasing competition. These challenges were key topics at the ninth edition of Fashion Digital Talks 2026, held in Mexico City under the theme “Fashion Without Borders.”

According to the report, Mexico’s online retail sales reached MX$941 billion in 2025, rising 19.2% year on year. Fashion accounted for nearly 18% of online retail sales. The study also found that 82% of Mexican internet users planned to purchase fashion, beauty or personal care products within the following three months.

Despite this growth, apparel manufacturing faces significant challenges. The National Chamber of the Apparel Industry (CANAIVE) reported that Mexico imported more apparel than it exported for the first time since the North American Free Trade Agreement (NAFTA) took effect in 1995. Rising domestic costs, a strong peso and increasing imports from China have added pressure on local manufacturers.

Apparel imports from China reached US$3 billion in 2025, an increase of 22% compared with two years earlier. Industry representatives also raised concerns about undervalued and smuggled goods that avoid taxes and import duties.

Artificial intelligence (AI) emerged as a potential solution. Industry leaders highlighted its role in understanding consumer behaviour, forecasting demand, reducing excess inventory and improving supply chain traceability. Businesses are also exploring omnichannel retail and digital tools to improve customer experiences and reduce the impact of product returns.

Meanwhile, Mexico’s circular economy legislation is creating new responsibilities for businesses. The industry is also looking at domestic sourcing initiatives to strengthen local manufacturing and increase the value of Mexican-made products.

Fashion Digital Talks 2026 highlighted the opportunities created by digital commerce and the challenges facing domestic production. For Mexico’s fashion industry, long-term growth will depend on technology adoption, stronger local manufacturing, responsible sourcing and more competitive business strategies.