USMCA Auto Parts Carveout to Continue; OEMs to Avoid Some Parts Tariffs
Automakers who build cars in the U.S. will be able to avoid paying tariffs on some imported auto parts, to the degree that they have sold U.S.-built cars in the U.S., a senior Commerce official said on a call with reporters.
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Automakers will notify the Commerce Department about the vehicles they have sold, and what the MSRP was for those cars and light trucks. The administration will then notify CBP that automakers have a credit worth 15% of that dollar amount, and will be allowed to apply that credit to imported auto parts. The sales that will be used for the credit began April 3. Auto parts tariffs go into effect May 3.
Moreover, imported auto parts that qualify under USMCA will continue to be tariff-free, the official said. Previously, the administration had said that USMCA parts would be tariffed on their Mexican or Canadian value, once the Commerce Department was able to quantify how much of the value was domestic.
Steel derivative or aluminum derivative tariffs will also not apply to the imported parts, he said.