U.S. Customs and Border Protection clarified on Thursday that automotive components compliant with the Canada-U.S.-Mexico Agreement (CUSMA) will avoid President Donald Trump's 25% tariffs set to take effect May 3. The exemption applies specifically to parts produced within the continental trade bloc, offering relief to manufacturers in Canada and Mexico.
The tariffs, announced last month, target all non-U.S. vehicle imports but carve out exemptions for parts integrated into American-assembled cars under CUSMA. However, foreign-made components in vehicles completed outside the U.S. will still face the levy, creating potential supply chain complexities for global automakers.
Industry analysts note the move reinforces North America's integrated auto market while incentivizing regional production. Businesses with cross-border operations are advised to review compliance timelines, as non-CUSMA parts—including those from Asia or Europe—remain subject to tariffs. This development underscores shifting trade dynamics as stakeholders adapt to evolving U.S. policy.
