Trump announces customs reservations for the US car industry in Michigan!

Trump announces customs reservations for the US car industry in Michigan!

Detroit, USA - The US government plans customs easier for the auto industry to promote American production. President Trump is expected to present these measures when he visited Michigan on Tuesday. Michigan is the location of the three great Detroit carmakers and numerous suppliers. As expected, the vehicle manufacturers rely on these reliefs before Trump's journey. Companies that pay the 25 percent import of vehicles produced from abroad will in future be released from additional taxes on steel or aluminum, as Kosmo

A central goal of this regulation is to give car manufacturers time to relocate their supply chains to the USA. In addition, credits of up to 15 percent of the value of the vehicles mounted in the USA are planned. These credits can be offset against imported components. Vehicles that consist of at least 85 percent of US parts remained completely duty-free. The regulation applies to all car manufacturers producing in the USA, including foreign companies with production facilities in the USA, the information from Tagesschau .

Details on the new customs regulations

Trump also signed a decree to mitigate tariffs for car manufacturers. In the future, car manufacturers only have to pay one customs tariff: either 25 percent for cars built abroad or 25 percent for steel or aluminum. This procedure should serve not to burden manufacturers several times by tariffs and thus increase the competitiveness of the US industry. The regulation, which also applies to foreign car manufacturers such as BMW in South Carolina and Mercedes in Alabama, is gradually in force. In the first year, companies can receive up to 3.75 percent of the value of a vehicle built in the United States as a reimbursement, in the second year this value drops to 2.5 percent before the regulation expires in the third year, as ZDF reports.

The US trade minister Howard Lutnick described Trump's decree as a "great victory" for trading policy, while leading US auto manufacturers such as General Motors and Ford welcomed the customs easements. However, experts warn that the tariffs lead to higher car prices and that the sales figures of the US carmakers may decrease. Around 50 percent of the vehicles sold in the USA are currently being installed outside the country, since US manufacturers have shifted large parts of their production in countries such as Mexico.

risks and challenges

The market conditions for US car manufacturers are challenging. Many manufacturers fight internationally and had to make adjustments to remain competitive. General Motors, for example, gave up the European business, while Ford has difficulties in Europe. Auto analysts report structural problems in US manufacturers, including a lack of quality awareness and inflexible production facilities. Stephanie Brinley from S&P Global Mobility points out that the US market is saturated and the transformation to electromobility is slow.

The new customs announcements from the USA already have an impact on the international automotive industry, especially in Europe, where these regulations are perceived as a shock. Experts fear that Trump's Protectionist course could endanger the desired renaissance of the US car industry.