What new tariffs did the US impose on heavy-duty vehicles?

The US introduced a 25% import duty on most medium and heavy-duty vehicles and their parts, effective November 1, 2026. Buses and certain vehicles will face a 10% duty.

What is the purpose of these new vehicle tariffs?

The tariffs aim to reduce reliance on foreign manufacturing, strengthen domestic production, and secure US supply chains for critical vehicle components.

Are there any exemptions to the new US vehicle tariffs?

Yes. Imports from countries under the USMCA may qualify for partial relief if they meet regional value requirements, with tariffs applying only to the non-US portion.

How do the tariffs affect Mexico’s vehicle exports to the US?

Mexico, which produces many trucks and engines for the US market, faces challenges since exported trucks contain about 50% US content, below the required 64% to qualify for full USMCA relief.

What is the import adjustment offset mentioned in the Proclamation?

The import adjustment offset allows US-based manufacturers assembling vehicles or engines domestically to reduce their tariff obligations based on the value of their US production.

Who is responsible for administering and adjusting these tariffs?

The Secretary of Commerce is authorized to oversee the tariff programs, monitor imports, and adjust rates or offsets to address national security and economic concerns.

US Imposes 25% Tariffs on Heavy-Duty Vehicle Imports

On October 17, 2025, US President Donald Trump signed a Proclamation imposing new tariffs on imports of medium and heavy-duty vehicles (MHDVs) and their parts (MHDVPs). As a result, starting November 1, 2026, most MHDVs and MHDVPs will face a 25% import duty, while buses and certain vehicles will face a 10% duty. The purpose of these new tariffs is to reduce reliance on foreign production, encourage US-based manufacturing, and strengthen supply chains for critical vehicle and parts production.

The Impact of the Proclamation

Even though the Proclamation imposes new tariffs on almost all MHDVs and MHDVPs imports, it provides certain exemptions. For example, imports under the United States-Mexico-Canada Agreement (USMCA) may qualify for partial relief if importers can prove the portion of the vehicle’s value that originates in the US, with the tariff applying only to the non-US part. However, to qualify, at least 64% of a heavy truck's value must originate in North America.

Mexico, which loudly opposed these tariffs, has 14 manufacturers and assemblers of buses, trucks, and tractor-trucks, and two manufacturers of engines. The main reason for concerts on the Mexican side is that, on average, exported trucks to the US have 50% US content, including engines.

Additionally, to support US manufacturers, a so-called import adjustment offset is introduced. This measure allows companies assembling vehicles or engines in the US to offset part of their tariff obligations, reflecting the value of domestic production. Notably, the Proclamation authorizes the Secretary of Commerce to administer these programs, monitor imports, and adjust tariffs or offset as necessary to address national security concerns.

Conclusion

The Proclamation continues the previously imposed tariffs and introduces trade measures on automobiles, steel, and aluminum, ensuring consistency in the application and coordination of tariffs across sectors. Notably, the Proclamation authorizes federal government bodies with broad power to modify, enforce, or adjust these tariffs and related programs through regulations and guidance.

Source: White House, Reuters