President Donald Trump issued an executive order Tuesday altering some of the tariffs on imported auto parts for the assembly of domestically produced vehicles.
The order did not adjust the 25 percent tariff on aftermarket imported auto parts, expected to start May 3.
The newest executive order will allow American auto manufacturers to import some parts without a tariff through credits. Auto manufacturers will receive an import adjustment up to 3.75 percent of the vehicle’s MSRP for all automobiles assembled in the United States through April 30, 2026. The rate declines to 2.5 percent between May 1, 2026, and April 30, 2027.
The tariffs on auto parts are expected to raise prices in the used vehicle market. The list of parts impacted was recently published in Annex I of the Federal Register Notice. The parts on the list include hoses, tires, suspension, lights, body parts, transmission, engine components and more, based on the Harmonized Tariff Schedule of the United States (HTSUS) numbers included in the order on pages 11 and 12.
