Trump announces 25 percent tariffs on medium and heavy imported trucks

As a significant step in his efforts to shield US businesses from foreign competition, President Donald Trump has announced that all medium- and heavy-duty trucks coming into the country will be subject to a 25% tariff rate starting on November 1.

On Monday, Trump made the announcement.

Trump stated last month that on national security-related grounds, heavy truck imports would be subject to new duties on October 1 because the new tariffs would benefit businesses like Paccar-owned Peterbilt, Kenworth, and Daimler Truck-owned Freightliner.

The US has agreed to 15% tariffs on light-duty vehicles under trade agreements with Japan and the European Union, but it’s not clear if this rate will apply to larger vehicles.

Additionally, the Trump administration has allowed Canadian and Mexican producers to deduct Canadian and Mexican import taxes on the value of US components.

Buses for transit, shuttles for schools, tractor-trailer trucks, semitrucks, and heavy-duty vocational vehicles are some examples of the larger vehicles.

Impact on allies

The US Chamber of Commerce earlier urged the US Commerce Department to refrain from imposing new truck tariffs, noting that Mexico, Canada, Japan, Germany, and Finland are the top five importers, “all of whom are United States allies or close partners of the United States and don’t pose any threat to US national security.”

The US exports the most medium- and heavy-duty trucks, with Mexico leading the pack. According to government statistics, imports of those larger vehicles from Mexico have tripled since 2019 to around 340, 000, according to a study released in January.

Medium- and heavy-duty trucks are exempt from tariffs under the United States-Mexico-Canada Agreement (USMCA) trade agreement if at least 64 percent of a heavy truck’s value comes from North America via components like engines and axles, steel raw materials, or assembly labor.

The parent company of Chrysler, Stellantis, which produces heavy-duty Ram trucks and commercial vans in Mexico, may also be affected by tariffs. Stellantis had been working with the White House to prevent the White House from imposing high tariffs on its trucks made in Mexico.

In Monterrey, Mexico, Volvo Group of Sweden is planning to open a $ 700 million heavy-truck factory in 2026.

According to the US International Trade Administration, Mexico is home to 14 manufacturers and assemblers of buses, trucks, and tractor trucks, as well as two engines.

Mexico objected to new tariffs, telling the US Commerce Department in May that diesel engines are typically included in all Mexican trucks that are exported to the US.