US Imports Tariffs on Cars & Car Parts
- Arne Mielken
- 3 days ago
- 5 min read
🔓 Importers face a new 25% tariff on cars and light trucks & parts entering the U.S.
Executive Brief
Since April 3, 2025, an additional 25 percent duty has applied to imports of motor vehicles. Since May 3, 2025, the same duty also applies to car parts. In the future, exceptions will be made for imports under USMCA, the UK & EU.
Key Takeaways
New 25% duty applies to imports of passenger vehicles and light trucks into the USA.
Effective April 3, 2025, covering a wide range of HTSUS codes under headings 9903.94.01 to 9903.94.04.
Importers face major compliance risks if they misclassify, misreport U.S. content, or ignore special exemptions.
“Section 232 auto tariffs will test the resilience of every importer’s compliance systems. Preparation is non-negotiable.”Arne Mielken, Managing Director, Customs Manager
Contents
Changes to the US tariff schedule
Affected goods
Exceptions for EU goods
Exceptions for UK goods
Possible duty refunds for US car manufacturers
Exceptions for USMCA goods
Date of import is decisive
Goods in Foreign Trade Zones (FTZ)
Drawback
Since April 3, 2025, at 12:01 a.m. EST, motor vehicles imported into the US are subject to an additional 25 percent ad valorem duty. Car parts have been subject to the same additional duty since May 3, 2025. President Donald Trump imposed these measures on March 26, 2025, through Proclamation 10908 under Section 232 of the Trade Expansion Act. The justification is that imports of certain cars and car parts threaten US national security.
On April 29, 2025, Trump amended Proclamation 10908: US car manufacturers that import parts for assembly in the US can apply for a refund of duties. The refund amount depends on the value of US car production.
Changes to the US Tariff Schedule
To implement the new tariff rates, Subchapter III of Chapter 99 of the Harmonized Tariff Schedule of the United States (HTSUS) has been amended in line with the proclamation.
The new 25 percent duty is levied in addition to any existing (anti-dumping) duties, fees, or charges.
Affected goods
Vehicles
Passenger cars and light trucks such as sedans, SUVs, crossovers, minivans, vans, and pickups are affected. Covered tariff codes include:
8703.22.01, 8703.23.01, 8703.24.01, 8703.31.01, 8703.32.01, 8703.33.01, 8703.40.00, 8703.50.00, 8703.60.00, 8703.70.00, 8703.80.00, 8703.90.01, 8704.21.01, 8704.31.01, 8704.41.00, 8704.51.00, 8704.60.00
Car parts
Key parts such as engines, transmissions, drivetrain components, and electrical systems are included. CBP has published a list of affected items with tariff codes. The list may be expanded.
Exceptions for EU goods
Vehicles and parts originating in the EU will instead be subject to a reduced flat duty of 15 percent. This was agreed in the US-EU political deal confirmed on August 21, 2025. On August 28, implementation proposals were released to make this reduction retroactive to August 1. These still need approval from the European Parliament and Council.
Exceptions for UK goods
The US has introduced a tariff-rate quota (TRQ) for passenger cars under heading 8703 originating in the UK. Details are available in the US-UK agreement.
Duty refunds for US car manufacturers
The amendment to Proclamation 10908 allows US carmakers importing parts for local assembly to apply for partial refunds of the 25 percent duty on parts.
Refunds are capped at 3.75 percent of the value of vehicles manufactured in the US during the first year. This cap falls to 2.5 percent in the second year (May 1, 2026–April 30, 2027) and will then be phased out completely. Only vehicles assembled in the US qualify for this calculation. All other car imports remain subject to the 25 percent duty.
Exceptions for USMCA goods
Vehicles
Cars from Canada or Mexico are not automatically exempt. The 25 percent duty applies only to non-US components. If a vehicle qualifies for USMCA preferential treatment, importers may certify the US content. Only the non-US content is then subject to the duty.
"US content" means the value of parts fully obtained, produced, or substantially transformed in the US. "Non-US content" equals the total vehicle value minus the US content. If calculations are wrong, the full vehicle value is charged at 25 percent.
CBP has issued detailed guidance in CSMS #65649652.
Car parts
Parts qualifying under USMCA are exempt from the 25 percent duty until a new system is introduced that applies the duty only to the non-US content. This exception does not apply to complete knock-down kits or part assemblies. It applies only to parts as defined in Annex I of the proclamation, which will be published shortly in the Federal Register.
Date of import is decisive
Cars entered for consumption on or after April 3, 2025, 12:01 a.m. EST are subject to the 25 percent duty.
Car parts entered for consumption on or after May 3, 2025, 12:01 a.m. EST are subject to the 25 percent duty.
UK exemptions apply from June 30, 2025.
EU exemptions apply from August 7, 2025.
Goods in US Foreign Trade Zones (FTZ)
Vehicles and parts admitted to US FTZs on or after the effective date of the proclamation must be admitted in privileged foreign status under 19 CFR 146.41. They are then subject to all applicable tariff rates at the time of entry.
US Duty Drawback
No drawback is available. Additional duties are not refundable.
Top Tip: CBP addresses FAQs under "Section 232 Additional FAQs – Autos" and updates them regularly. Access them here |
Sources and Further Information
Proclamations
Proclamation amending Proclamation 10908: Amendments to Adjusting Imports of Automobile Parts into the United States (April 29, 2025)
Proclamation 10908: Adjusting Imports of Automobiles and Automobile Parts Into the United States (March 26, 2025)
CBP Guidance
CSMS #65649652 – Applying Section 232 Duties on USMCA-Qualifying Passenger Vehicles and Light Trucks
CSMS #65475228 – 2025 United Kingdom Automobile Tariff Rate Quota
CSMS #64916652 – Update to CSMS #64913145:D Guidance: Import Duties on Certain Automobile Parts
CSMS #64913145 – Guidance: Import Duties on Certain Automobile Parts
CSMS #64624801 – Guidance: Import Duties on Certain Automobiles
Fact Sheets
Disclaimer
Please note that the information provided in this article is for general informational purposes only and does not constitute legal, tax, or professional advice. While our aim is that the content is accurate and up to date, it should not be relied upon as a substitute for tailored advice from qualified professionals. We strongly recommend that you seek independent legal and tax advice specific to your circumstances before acting on any information contained in this article. We accept no responsibility or liability for any loss or damage that may result from your reliance on the information provided in this article. Use of the information contained in this article is entirely at your own risk.
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