After the U.S.-imposed tariffs caused chaos in the global economy, a number of changes were made to them, which helped some industries catch a break. Among them are auto component manufacturers, who can now count on benefits. Without these corrections, the situation in the automotive industry could have worsened significantly.
According to the updated rules, parts that meet the requirements of the United States-Mexico-Canada Agreement (USMCA) are exempt from the 25 percent tariff. This is despite previous statements by former President Trump that non-American components would later also fall under the increased tariffs. It is now confirmed that the zero tariffs will remain in effect.
As reported, the new rules allow automakers to claim a refund for customs duty expenses for a period of two years. This gives them time to move the production of parts to U.S. territory.
Mexico, as the largest importer of auto components to the States, positively assessed the USMCA exemption. The country’s President, Claudia Sheinbaum, called it “good news,” noting that she continues to cooperate with Trump and is achieving better terms compared to the previous situation.
“There is a preferential regime for everything produced under the trade agreement, especially for auto parts, which are not subject to tariffs,” she added.
However, the American president continues to impose 25 percent tariffs on imported automobiles to stimulate their production in the USA. Although some brands have already announced an expansion of production in the country, prices for new and used cars are expected to rise until dealers sell off the inventories formed before the introduction of the tariffs.