President Trump Announces Extended Tariff Relief for Automakers, Clarifies Tariffs on Buses, Trucks 

The automotive industry is getting long-awaited relief from tariff pressures that have weighed heavily on the industry throughout 2025. A five-year extension of a key tariff offset provision will allow automakers to continue to reduce their effective costs, providing some balance after months of lobbying by OEMs and over $10 billion in tariffs paid this year alone. However, the announcement also comes with new import tariffs on imported trucks and buses that could raise costs for other segments of the transportation industry.

Our tariff support specialists break down the auto relief and enactment of imports on medium and heavy-duty trucks and buses.

Tariff relief for automakers

The extended provision allows automakers that import parts for vehicles assembled in the United States to offset 3.75% of a vehicle’s MSRP. This percentage reflects the estimated tax burden from a 25% tariff applied to 15% of the value of a U.S.-assembled vehicle.

The offset, originally scheduled to phase down before expiring in 2027, will now remain in effect through 2030. The move is expected to help U.S. automakers compete more effectively against Japanese manufacturers, whose tariffs were recently lowered to 15%.

The extension coupled with efforts to shield automakers and manufacturers from “tariff stacking” are two points that signal efforts to expand domestic vehicle production and help the largest OEMs producing in the U.S. to remain competitive on a global scale. Industry sources also suggest a separate offset program for engine manufacturers could soon be introduced.

Tariffs on medium and heavy-duty trucks, buses

In the same announcement, President Trump formalized new import tariffs aimed at other vehicle segments:

• 25% tariff on imported medium and heavy-duty trucks and parts
• 10% tariff on imported buses, including school buses and motor coaches

Both measures will take effect November 1. Under the truck tariffs, only the non-U.S. content portion of each vehicle will be subject to the 25% rate. However, buses will not receive any relief or offsets under the current plan.

Be proactive to manage tariff pressures

While automakers assembling vehicles domestically may benefit from the extended offset, the new tariffs on larger commercial vehicles could add cost pressures in other sectors. As tariffs continue to present challenges to the automotive and manufacturing industries, it is critical to plan ahead and strategize to mitigate your exposure. Fill out the form on this page to connect with our Tariff Support Specialists.