The following analysis was provided by NCBFAA Legislative Advisor Nicole Bivens Collinson of Sandler, Travis & Rosenberg, P.A.

Sandler, Travis & Rosenberg, P.A. (ST&R) notes the President on Wednesday, March 26, issued a Proclamation earlier today imposing 25% tariffs on imported cars and light trucks and certain vehicle parts under Section 232 of the Trade Expansion Act of 1962 on national security grounds. The tariffs are based on the results of the 2019 initial investigation and newly provided information from the Commerce Secretary, among other things.

The proclamation is available here , including a summary of the key details:

Tariffs

• A 25% tariff is imposed on all imports of specified automobiles and certain automobile parts (as described below). The proclamation states that this tariff is in addition to any other duties applicable to the imported merchandise.

Products Subject to Tariffs

• Automobiles : This includes passenger vehicles (sedans, sport utility vehicles, crossover utility vehicles, minivans, and cargo vans) and light trucks
• Certain Automobile Parts : This includes engines and engine parts, transmissions and powertrain parts, and electrical components
• The actual scope of the products subject to the tariffs on automobiles and parts is defined by ANNEX I, which has not yet been published. We will circulate once it is published.

Effective Dates

• The tariffs on automobiles will be effective from 12:01 a.m. ET on April 3.
• The tariffs on automobile parts will be effective on the date specified in the Federal Register, but no later than May 3.

USMCA-Originating Vehicles and Parts

• Automobiles : For automobiles that qualify for preferential tariff treatment under the USMCA, importers may submit documentation to identify the amount of U.S. content in each model imported. The 25% tariff will then apply exclusively to the value of the non-U.S. content of the automobile. U.S. content is identified as “parts wholly obtained, produced entirely, or substantially transformed in the United States.” Subsection (2).
• Enforcement of U.S. Content and Claw back Provision:
  • If U.S. Customs and Border Protection (CBP) determines that the declared value of non-U.S. content is inaccurate, the 25% tariff will apply to the full value of the automobile.
  • The 25% tariff will be imposed retroactively to April 3 for all entries of the same model imported by the same importer and until such time as the importer corrects the overstatement and it is verified by CBP.
• Automobile Parts : For automobile parts that qualify for preferential treatment under the USMCA, the 25% tariffs will not apply until the Secretary of Commerce establishes a process to apply the tariff exclusively to the value of the non-U.S. content in a subsequent Federal Register notice.

Process to Add Parts to Section 232 USMCA-Originating Vehicles and Parts

• The Secretary of Commerce is required to establish a process to add additional automobile parts to the Section 232 list within 90 days of the date of the proclamation (by June 24, 2025). The process shall include the following:
  • At the request of domestic producer or industry association representing at least one domestic producer.
    • Must demonstrate that imports of automobile parts have increased in a manner that threatens national security or otherwise undermines the objectives of the automotive 232 proclamations.
    • Upon receipt the Secretary of Commerce shall consult with USITC and CBP
    • A determination must be issued within 60 days after receipt of request
    • A Federal Register notice shall be issued within 14 days after the Secretary’s determination
    • Tariffs will be effective on the newly added part on the day after publication.

As in the past, we expect that the forthcoming Federal Register notices will provide additional detail and in particular, the list of parts that are subject to the 232 tariffs. We will forward the notice once we receive it.

During the press questions after signature, President Trump indicated that he will also be announcing tariffs on lumber, pharmaceuticals and possibly on computer chips. There may be more, but those are industries he singled out.

In addition, if you are negatively impacted by the IEEPA tariffs on Canada, the Senate will be voting on April 1 to terminate the emergency. You may wish to voice your concern to your Senators, urging them to vote for/YES on the joint resolution , S.J. Res. 37. The switchboard number is (202) 224-3121 and ask to be connected to your Senator’s office.

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Meanwhile, NCBFAA will continue to keep our members updated about the U.S. tariffs through the Monday Morning eBriefing and eblasts, and a dedicated IEEPA Tariffs webpage on our website.

Attention: The Monday Morning eBriefing (MMeB) and other communications of the NCBFAA are the exclusive property of the Association. Unauthorized use by any person or firm which is not a member in good standing is strictly prohibited.