in effect
Proclamation 10925, signed April 29, 2025, is a presidential action that amends an earlier proclamation (10908, March 26, 2025) which had imposed 25% tariffs on imported automobiles and automobile parts under Section 232 of the Trade Expansion Act of 1962. It modifies how those tariffs apply to automobile parts specifically by introducing a credit mechanism tied to domestic vehicle assembly.
Automobile manufacturers that assemble vehicles inside the United States become eligible for an “import adjustment offset” — a dollar credit that reduces what they owe in Section 232 tariffs on imported parts. For the period April 3, 2025 through April 30, 2026, a manufacturer may claim an offset equal to 3.75% of the total Manufacturer’s Suggested Retail Price (MSRP) of all vehicles it assembles in the US; that rate drops to 2.5% of MSRP for May 1, 2026 through April 30, 2027. The offset cannot exceed the manufacturer’s actual parts-tariff bill and cannot be applied to any other tariff obligation. Within 30 days of the proclamation, the Commerce Secretary must open an application process requiring manufacturers to submit certified projections of US assembly volume, projected tariff costs, and the names of authorized importers of record; a senior company officer must sign under penalty of perjury. US Customs and Border Protection (CBP) then applies the approved offset against tariff payments as parts enter the country, and may impose maximum legal penalties if an importer claims more than was approved.
Automobile manufacturers with US final-assembly plants are the primary parties — they can apply for offsets that lower their import-parts tax bill in proportion to how many vehicles they build domestically. Parts suppliers and importers of record in a manufacturer’s supply chain are also affected, because a manufacturer may authorize its suppliers to use a share of the offset when paying duties on parts they import on the manufacturer’s behalf. Foreign-only producers and importers with no US assembly operations receive no offset and continue to pay the full 25% tariff on covered automobile parts.