White House Details Trump’s New Truck Tariffs
Tariffs Take Effect Nov. 1, but USMCA Trucks Avoid the Hit
Key Takeaways:
- President Donald Trump signed an Oct. 17 proclamation imposing 25% tariffs on imported medium- and heavy-duty trucks and parts and 10% on buses starting Nov. 1.
- Truck imports qualifying under the U.S.-Canada-Mexico Agreement are exempt, while the order extends through 2030 a tariff offset for U.S. automakers and plans a similar program for engine makers.
- The move highlights Trump’s broader tariff strategy to bolster domestic manufacturing as the Supreme Court prepares to review the legality of related trade measures next month.
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The Trump administration formally imposed 25% tariffs on imported medium- and heavy-duty trucks and parts, as well as a 10% duty on buses, while extending a key tariff reprieve for American automakers.
President Donald Trump signed a proclamation Oct. 17 hitting trucks and buses with tariffs beginning Nov. 1, according to a . Trump announced plans for the levies earlier this month.
The directive also prolongs through 2030 a tariff discount Trump already provided carmakers that produce and sell completed automobiles in the U.S. and sets in motion plans to apply the same offset for truck duties. Truck imports that qualify for relief under the U.S.-Canada-Mexico trade agreement will be exempt from the charges, but not buses, according to the fact sheet.
The administration also is creating an additional carveout for companies that make engines for passenger vehicles as well as medium- and heavy-duty trucks in the U.S., which would be patterned on the existing offset program for completed vehicles, but will not take effect immediately.
Industry Pushback, USMCA Exemptions
The decisions reflect Trump's difficult balancing act as he seeks to reorient global trade flows and revive domestic manufacturing. Trump has broadly wielded tariffs to penalize imports and spur domestic production and jobs. But manufacturers rely on global supply chains to produce finished goods in the U.S., exposing even domestic production to Trump’s duties.
RELATED:How Trump's Tariffs on Trucks, Parts Could Hit Fleets, OEMs
Truck makers for reductions and other stakeholders warned about the potential for sweeping tariffs to cause higher vehicle costs, which also could ripple through the construction and shipping industries. The USMCA exemption could potentially dull the impacts on Ram pickups made by Stellantis NV in Mexico, representing some of the about 245,000 medium- and heavy-duty trucks imported to the U.S. last year, according to Commerce Department data.
Under the auto-tariff relief measure, carmakers can claim an offset worth 3.75% of the value of their American-made vehicles, which is meant to help blunt the cost of 25% duties on imported parts and provide time for supply chains to be shifted to the country.
(Bim/Getty Images)
Five-Year Extension for Offset Program
While Trump initially planned a two-year phaseout for the offset, he now is extending the initiative for five years, according to the White House. The engine program also is intended to cover the same timeframe.
The concession marks a win for companies including Ford Motor Co. and General Motors Co., which argued Trump's trade policies advantaged some foreign competitors. That's particularly true for cars made in Japan, which are subject to lower 15% tariffs under an agreement the country struck with the U.S., rather than the 27.5% rate they previously were charged under Trump.
“A level playing field with a stable and affordable supply chain will mean more growth in America and ultimately more job security and profit sharing for our front-line workers,” Ford CEO Jim Farley said in a statement.
RELATED:Why America’s Trade Partners Oppose Trump’s Truck Tariffs
The car part and truck tariffs are part of an expanding pool of levies Trump is wielding against a range of consumer goods — from steel and copper to lumber and upholstered furniture.
Trump has ordered the tariffs under Section 232 of the Trade Expansion Act, which empowers the levies to address imports deemed to threaten national security. The sectoral tariffs are distinct from country-based levies Trump has imposed using an emergency law — which two federal courts have ruled illegal. The Supreme Court is set to review the administration’s appeal next month.
Jennifer A. Dlouhy and Skylar Woodhouse contributed to this report.
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