Trump Will Exempt Automakers From Tariffs: Report
President Trump is planning to exempt auto parts from some of the most heavy duty tariffs imposed on foreign imports, in what insiders are calling a “de-stacking” of duties.
Key Points
- President Donald Trump is expected to exempt automotive parts from some newly imposed tariffs, following heavy lobbying by automakers.
- While the 25% tariff on imported vehicles will remain, auto parts could be excluded from additional steel, aluminum, and China-specific tariffs.
- Major automakers, including Stellantis and Honda, warned that compounded tariffs threaten supply chains, pricing, and job stability.
According to FT, the move would carve out exemptions for imports from China, along with separate tariffs on imported steel and aluminum. While a 25-percent tariff on fully assembled foreign-made vehicles would remain in place, the looming 25-percent tariff on auto parts scheduled to take effect on May 3 may be revised or delayed.
Automakers have ramped up their lobbying as of late, warning that the compounded costs of tariff stacking would lead to price hikes, disrupted or destroyed supply chains, and catastrophic domestic job losses.
According to the framework under review, complete vehicles and parts that meet USMCA rules will only be taxed on their non-U.S. content, a huge sigh of relief for automakers with operations in Mexico and Canada. Any auto parts imported from China will still face a 20 percent “fentanyl-related” tariff, in addition to applicable steel and aluminum duties. It's still unclear what exactly this will mean for Chinese-made vehicles like the Lincoln Nautilus and Buick Envision.
It's unclear if automakers will walk back some of their most recent moves, including Mazda's decision to stop exporting the CX-50 to Canada, Subaru's announced production shift in Indiana, Toyota's RAV4 rework, or Honda's Civic production shuffle.
The administration has not officially commented.
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An experienced automotive storyteller and accomplished photographer known for engaging and insightful content. Michael also brings a wealth of technical knowledge—he was part of the Ford GT program at Multimatic, oversaw a fleet of Audi TCR race cars, ziptied Lamborghini Super Trofeo cars back together, been over the wall during the Rolex 24, and worked in the intense world of IndyCar.
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I don't think we should believe anything Trump says. He's kinda like the crazy old uncle you sit in a far corner when everyone shows up for the holidays. Great story teller though. Apparently his only deal to date was with England where he was only going to taffif Brit cars at 10%. Those car's would be all the ultra expensive millionaire rides that normal people wouldn't be buying anyway,,, Just Trump's acquaintances.
(I won't say friends because I don't think he has any).