New 25% Tariff on Imported Trucks to Impact Market by 2025

New Tariff on Imported Trucks Set for 2025 In a recent announcement, President Donald Trump revealed a significant policy shift that will implement a 25% tariff on medium- and heavy-duty trucks imported into the United States. This tariff is set to take effect on November 1, 2025, as part of an effort to bolster American manufacturing. Trump, expressing his reasoning for the tariff, stated that it is critical to defend US truck manufacturers against what he terms “unfair outside competition.” He shared the news on Truth Social, stating, “Beginning November 1st, 2025, all Medium and Heavy Duty Trucks coming into the United States from other Countries will be Tariffed at the Rate of 25%.” This policy marks a shift from the previous terms under the US-Mexico-Canada Agreement (USMCA), which allowed Mexican-built medium- and heavy-duty trucks that adhere to specific component content rules to enter the US market tariff-free. With this new tariff, the focus is moving towards targeting the truck manufacturing sector itself rather than imposing tariffs based on the country of origin. Notably, Mexico is the leading exporter of heavy trucks to the United States, and many of these trucks incorporate a considerable amount of US-made parts. Automakers such as Stellantis and Volvo, which have production facilities in Mexico, could be impacted significantly by this new tariff, facing potential increases in operational costs. The initiative follows a Section 232 national security investigation conducted earlier in the year that assessed the implications of foreign truck imports on domestic manufacturing capabilities. The announcement has sparked concern among industry leaders in both the automotive and freight sectors. Executives are noting that this tariff could lead to higher prices for imported trucks, disrupt existing supply chains, and escalate costs associated with replacing fleets. While analysts suggest the tariffs might favor domestic truck manufacturers, there are fears that this could also lead to elevated prices and lessen competitive options for consumers.