New Policy Offers Offset Credits for Automakers Building and Selling in the U.S.

President Trump has amended the U.S. tariff on auto imports, offering relief to manufacturers that increase vehicle assembly and sales within the United States — part of a broader national security strategy under Section 232.  

In this April 29 Proclamation, President Trump authorized a modified tariff system that ties relief to domestic vehicle production and sales. Automakers that build and sell vehicles in the United States will be eligible for tariff offset credits that reduce their duties on imported parts.

Offset Amounts and Eligibility

Tariff offset include:

• From April 3, 2025, through April 30, 2026, automakers can receive a credit equal to 3.75% of the MSRP value of all U.S.-assembled vehicles.
• From May 1, 2026, through April 30, 2027, the credit drops to 2.5% of the MSRP for those same qualifying vehicles.

These percentages reflect the effective tariff burden when a 25% duty is applied to parts making up 15% (in Year 1) and 10% (in Year 2) of a car’s value. Credits can only offset tariff liabilities tied to the manufacturer’s own auto parts imports and cannot be transferred to other duties or overclaimed.

If the offset exceeds the importer’s total Section 232 duties for auto parts, the offset will be capped at the Section 232 auto parts’ duty amount.

Manufacturers may designate specific importers of record—including their suppliers—to use the credits, but any credit amount exceeding the manufacturer’s total parts-related tariff liability will be forfeited.

The list of products affected can be found through the Federal Register Automobiles and Automobile Parts, Imports Into U.S.; Adjustment (Proc. 10908), alternatively also accessible via PDF format.