USMCA Reduces Tariffs on Medium and Heavy Vehicles from Mexico

The administration of President Donald J. Trump formally issued the declaration imposing 25% tariffs on imports of medium and heavy-duty vehicles (MHDVs), as well as auto parts used to produce such units.

The measure, which takes effect on November 1, grants trucks and components produced in Mexico and Canada the same concessions that currently apply to light motor vehicles and their auto parts.

In other words, if the product complies with the USMCA rules of origin, it will only be taxed on non-U.S. content.

This measure will not apply to buses, which will be subject to a 10% import tariff, the same rate as for other countries.

In the case of auto parts for heavy vehicles produced in Mexico that comply with USMCA guidelines, they will remain tariff-free until a way is determined to establish the non-U.S. content to be taxed in each case.

The declaration also extends until 2030 a tariff discount that the Trump administration already granted to automakers that produce and sell light-duty vehicles finished in the United States, but also sets in motion plans to apply the same compensation to truck manufacturers.

Under this scheme, producers of medium- and heavy-duty vehicles assembled in the United States will be able to obtain a tariff refund on imported auto parts equivalent to up to 15% of the vehicle's value for the next five years.

Manufacturers will be able to request “import adjustment compensation equivalent to 3.75% of the added value of all medium- and heavy-duty vehicles assembled in the United States from November 1, 2025, to October 31, 2030,” the statement said.

The new decree also provides for an additional exemption for companies that manufacture engines for light, medium, and heavy vehicles, based on the existing compensation program for finished vehicles, but it will not take effect immediately.