Automakers paying customs duties are not charged to other taxes, such as steel or aluminum.
President Donald Trump will ease some taxes imposed on foreign auto parts intended for use in US-made vehicles, Commerce Secretary Howard Lutnick said Monday.
Lutnick said he will “build a key partnership” with US automakers through transactions that will help Trump reduce the impact of tariffs on the domestic auto industry.
“The contract is a major victory for the President’s trade policy by rewarding companies that manufacture domestically, and at the same time provides a runway for manufacturers who have expressed their commitment to expanding investment in the US and manufacturing in Japan,” Lutnick said in a statement.
The arrangement, originally reported by the Wall Street Journal, means that no other taxable automakers, such as steel or aluminum, will be charged with the refunds against the duties already paid.
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“Automobile parts tariffs will scramble the global automotive supply chain, leading to rising consumer car prices, reduced sales at dealers, and the domino effect that makes both vehicle servicing and repairs more expensive and predictable,” they said.
“Many are already suffering and face production halts, layoffs and bankruptcies,” they added, warning that “it’s just one supplier failing to lead to the closure of the automaker’s production line.”
The coalition consists of several automotive industry groups, including the Automotive Innovation Alliance.
“They are switching to parts made in Canada, Mexico and elsewhere,” he told reporters. “They’re going to make them here, so it’s going to take a little time.”
The Epoch Times reached out to the White House and the Commerce Department to comment on the tariff arrangements, but did not receive a response by the time of publication.
Tom Ozimek and Reuters contributed to this report.
