The President of the United States has announced new tariffs on imported automobiles and certain automobile parts. This decision follows a report from the Secretary of Commerce that imports are threatening national security. "Based on the facts considered in that investigation, the Secretary found and advised me of his opinion that automobiles and certain automobile parts are being imported into the United States in such quantities and under such circumstances as to threaten to impair the national security of the United States."
In May 2019, Proclamation 9888 directed negotiations with other countries, but these efforts did not result in agreements. The situation has worsened due to global supply chain vulnerabilities exposed by the COVID-19 pandemic. "The COVID-19 pandemic exposed critical vulnerabilities and choke points in global supply chains, undermining our ability to maintain a resilient domestic industrial base."
The President has decided it is necessary to impose a 25 percent tariff on these imports starting April 3, 2025, for automobiles, with tariffs on parts no later than May 3, 2025. "I find that imports of automobiles and certain automobile parts continue to threaten to impair the national security of the United States and deem it necessary and appropriate to impose tariffs."
For vehicles qualifying under USMCA preferential treatment, importers can document U.S. content for potential tariff reductions. If discrepancies are found by U.S. Customs and Border Protection (CBP), tariffs will apply retroactively.
"The ad valorem tariff of 25 percent described in clause (1) of this proclamation shall not apply to automobile parts that qualify for preferential treatment under the USMCA until such time that the Secretary...establishes a process to apply the tariff exclusively."
The Secretary will continue monitoring imports' impact on national security and inform if further actions are needed.
