Last week, President Donald Trump announced 25 percent tariffs on car imports and imported car parts. As originally written, the tariff called for 25 percent tariffs to be applied to “all imports” of vehicles as specified by the order, to be applied on April 3. Now that the tariff has finally been published in the Federal Register, import enthusiasts may be able to breathe easier. The government appears to be applying the tariff to cars younger than 25 years, so your next import might go smoothly.
Enthusiasts were understandably in a panic last week. The “ADJUSTING IMPORTS OF AUTOMOBILES AND AUTOMOBILE PARTS INTO THE UNITED STATES” document, as it was published on the White House website’s Presidential Actions page, seemed to imply that President Trump wanted to apply additional tariffs to every car coming across the border. But the Action was also just vague enough that nobody really knew what the government’s actual intentions were.
Had these tariffs gone through as expected, it had the potential to destroy the prices of some of the coolest cars Americans want to import. However, it appears that we’ve been given a reprieve. The official tariff proclamation document has been published in the Federal Register, and buried deep in the legalese is what appears to be a carve-out for those of us who love importing our dream cars from elsewhere.
Update, April 3: Yesterday, President Trump has announced reciprocal tariffs, which means you might be back to being screwed depending on where you’re getting your car from. Check the end of the article.
Last Week’s Nightmare
In case you’ve forgotten what Trump published last week, here is the original proclamation that alarmed the car importation community, emphasis mine:
On February 17, 2019, the Secretary of Commerce (Secretary) transmitted to me a report on his investigation into the effects of imports of passenger vehicles (sedans, sport utility vehicles, crossover utility vehicles, minivans, and cargo vans) and light trucks (collectively, automobiles) and certain automobile parts (engines and engine parts, transmissions and powertrain parts, and electrical components) (collectively, automobile parts) on the national security of the United States under section 232 of the Trade Expansion Act of 1962, as amended (19 U.S.C. 1862) (section 232). Based on the facts considered in that investigation, the Secretary found and advised me of his opinion that automobiles and certain automobile parts are being imported into the United States in such quantities and under such circumstances as to threaten to impair the national security of the United States.
[…]
Except as otherwise provided in this proclamation, all imports of articles specified in Annex I to this proclamation or in any subsequent annex to this proclamation, as set out in a subsequent notice in the Federal Register, shall be subject to a 25 percent tariff with respect to goods entered for consumption or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern daylight time on April 3, 2025, for automobiles, and on the date specified in the Federal Register for automobile parts, but no later than May 3, 2025, and shall continue in effect, unless such actions are expressly reduced, modified, or terminated. The above ad valorem tariff is in addition to any other duties, fees, exactions, and charges applicable to such imported automobiles and certain automobile parts articles.
The White House then published a Fact Sheet, which only confused matters:
The 25% tariff will be applied to imported passenger vehicles (sedans, SUVs, crossovers, minivans, cargo vans) and light trucks, as well as key automobile parts (engines, transmissions, powertrain parts, and electrical components), with processes to expand tariffs on additional parts if necessary.
The problem was that while the proclamation was worded in a manner to suggest that Trump was targeting new cars, that little “all imports” bit was concerning, as was the government’s not indicating whether the tariff was hitting new cars or not. The truth is pretty weird, but we’ll get to that in a moment.
Soon after this was published, several publications, including The Autopian, published articles about how these tariffs could hurt enthusiasts. I reached out to a few of my import contacts and even a Customs broker contact before writing my story, and all of them had the same gloomy perspective I did. Yet, while the prospect of this was terrible, it was going to be worse for some people than others.
I’ll use myself as an example. Last month, I purchased a 1997 Honda Life from a Japanese auction for $258. Normally, the purchase value of this car would be hit with a 2.5 percent import duty, or just $6.45. Had the 25 percent tariff gone through for over 25-year-old used cars, my car would have been subjected to a total duty of 27.5 percent, or the old duty plus the new tariff. That would have totaled $70.95, which would have sucked, but wouldn’t have been the end of the world.
Kei trucks would have been hit worse. They were already subjected to the infamous 25 percent ‘Chicken Tax’, but then they would have been hit by the additional 25 percent on top of that. That means a total import duty of 50 percent. That’s $500 on a truck worth $1,000. Again, that’s not great, but it could be worse.
The cars that would have been hit the worst were the sports cars and supercars of your youth. If you spent $50,000 on a Honda NSX in Japan, you would have spent an additional $13,750 in import duties alone. That’s before you pay for shipping and before you pay your exporter. This would have priced some enthusiasts out of their dream cars.
You Might Breathe Easier
Thankfully, the official rule as published in the Federal Register today seems to be a bit easier on enthusiasts. This news comes to us from our friends at The Import Guys, the firm that handled the import of my 1991 Honda Beat. Here’s some boring legalese that you need to know:
A. Effective with respect to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern daylight time on April 3, 2025:
a. The following new note 33 to subchapter III of chapter 99 of the Harmonized Tariff Schedule of the United States (HTSUS) is inserted in numerical order:“33. (a) Except as provided for in headings 9903.94.02, 9903.94.03, and 9903.94.04, heading 9903.94.01 provides the ordinary customs duty treatment applicable to all entries of passenger vehicles (sedans, sport utility vehicles, crossover utility vehicles, minivans, and cargo vans) and light trucks (hereinafter, automobiles) from all countries classifiable in the headings or subheadings enumerated in subdivision (b) of this note.
Except as provided for in subdivision (d) to this note, for any such products that are eligible for special tariff treatment under any of the free trade agreements or preference programs listed in general note 3(c)(i) to the tariff schedule, the duty provided in heading 9903.94.01 shall be collected in addition to any special rate of duty otherwise applicable under the appropriate tariff subheading. Goods for which entry is claimed under a provision of chapter 98 and which are subject to the additional duties prescribed herein shall be eligible for and subject to the terms of such provision and applicable U.S. Customs and Border Protection (“CBP”) regulations, except that duties under subheading 9802.00.60 shall be assessed based upon the full value of the imported article. No claim for entry or for any duty exemption or reduction shall be allowed for the passenger vehicles and light trucks enumerated in subdivision (b) of this note under a provision of chapter 99 that may set forth a lower rate of duty or provide duty-free treatment, taking into account information supplied by CBP, but any additional duty prescribed in any provision of this subchapter or subchapter IV of chapter 99 shall be imposed in addition to the duty in heading 9903.94.01. All antidumping, countervailing, or other duties and charges applicable to such goods shall continue to be imposed in addition to the duty in heading 9903.94.01.
What’s applicable to enthusiasts is Heading 9903.94.04, which states:
Heading 9903.94.04 applies to all entries of passenger vehicles (sedans, sport utility vehicles, crossover utility vehicles, minivans, and cargo vans) and light trucks from all countries classifiable in the headings or subheadings enumerated in subdivision (b) of this note that were manufactured in a year at least 25 years prior to the year of the date of entry.
Additionally, Heading 9903.94.01 says:
Except for 9903.94.02, 9903.94.03, and 9903.94.04, effective withrespect to entries on or after April 3, 2025, passenger vehicles (sedans, sport utility vehicles, crossover utility vehicles, minivans, and cargo vans) and light trucks, as specified in note 33 to this subchapter, as provided for in subdivision (b) of U.S. note 33 to this subchapter.
The document then says that aside from the entries covered by 9903.94.02, 9903.94.03, and 9903.94.04, imports will be hit by the 25 percent tariff.
This should mean that if you import a car that’s at least 25 years old, you should be exempt from the additional tariff. I say “should” here because if it’s not clear by now, the Trump Administration seemingly changes its stances by the hour, and who knows what you’ll have to deal with at the port. But at least on paper, it sounds like vintage imports from Japan and Europe will continue to pay the import duties that they used to.
Weirdly, the way this document is written suggests that used vehicles that are younger than 25 years old would be hit by the tariff. You might run into a situation like this when importing a vehicle from the National Highway Traffic Safety Administration’s “List of nonconforming motor vehicles that are eligible for importation.” By that, I mean that my 1997 Honda Life would be fine, but if you imported a 2007 Smart Fortwo, which is on that list, you’d be hit by the tariff.
The wording also implies that certain used vehicles entering the country through the northern or the southern borders may also be hit by tariffs. However, that’s been a whole deal since the United States-Mexico-Canada Agreement, as noted by U.S. Customs and Border Protection.
So, there’s a lot of good news here. If you have a dream car in Japan or Europe that you want to buy, you should be able to import that car without giving an extra 25 percent to Uncle Sam. However, there will still be way too many vehicles and car parts hit by the tariffs. For now, I’m going to breathe a sigh of relief.
Update: Well, that sigh is now one of dismay.
On April 2, a whole new proclamation was released by President Donald Trump announcing reciprocal tariffs. Here are the meat and potatoes from the White House:
- Using his IEEPA authority, President Trump will impose a 10% tariff on all countries.
- This will take effect April 5, 2025 at 12:01 a.m. EDT.
- President Trump will impose an individualized reciprocal higher tariff on the countries with which the United States has the largest trade deficits. All other countries will continue to be subject to the original 10% tariff baseline.
- This will take effect April 9, 2025 at 12:01 a.m. EDT.
A reciprocal tariff is a “tit-for-tat” policy where one country raises its import duties to counter another country’s duties. Trump says he’s doing these tariffs due to trade practices he believes are unfair to the United States. At any rate, things might get really weird soon.
President Trump has selected a 24 percent reciprocal tariff on all products from Japan.
If you have a car arriving from Japan on or after April 5, but before April 9, your vehicle may be subjected to a 10 percent duty on top of existing duties. That means 2.5 percent plus 10 percent for a total of 12.5 percent for regular cars. If you’re importing a Kei truck, you still have to deal with the 25 percent Chicken Tax, and then you may pay the additional 10 percent to get you to 35 percent.
If your vehicle arrives from Japan on or after the above April 9 time, your total duty might increase to 26.5 percent or 49 percent, respectively.
Thankfully, the reciprocal tariff does not stack. If you’re already importing a car part or a car that’s subject to the auto tariff, then you won’t also get hit with the reciprocal tariff. From the Fact Sheet:
- Some goods will not be subject to the Reciprocal Tariff. These include: (1) articles subject to 50 USC 1702(b); (2) steel/aluminum articles and autos/auto parts already subject to Section 232 tariffs; (3) copper, pharmaceuticals, semiconductors, and lumber articles; (4) all articles that may become subject to future Section 232 tariffs; (5) bullion; and (6) energy and other certain minerals that are not available in the United States.
I bet you’re seeing why I’m saying “may” now. Technically, the import of a used car falls under Section 232 tariffs, so your car should not be hit by these reciprocal tariffs. However, as we discussed earlier, 25-year-old cars are exempt from Section 232 tariffs. Does this mean you’ll now get hit by the reciprocal tariffs? Unfortunately, this is unclear at this time. I will update on this apparently rapidly changing situation if I get a clear answer.
Otherwise, please refer to the massive reciprocal tariff list to see how much extra your next import might cost you depending on what happens next. Remember to add an additional 2.5 percent if it’s a passenger car or an additional 25 percent if it is a truck.
Top Photo: Nissan
Can someone please remind me why this is happening?
Because we are being governed by the Dunning Kruger Effect personified.
A word of the day calendar that was tossed after day 1: Tariffs. The page wasnt flipped to show the definition
WTF did Micronesia ever do to us? Hardly seems fair.
They know what they did.
oh wait I’m being told they asked “the fuck?”
Thanks Orange Turd. DOW down 1,500 in first hour this morning.
“It’s gonna be the most beautiful fuck up you ever saw.”
“Let them eat cake.”
“Eat shit you idiot…”
Sigh… Man this is getting complicated! The whiplash is getting old too. Just make a decision and stick to it already.
ah, something rich people can afford is fine…
…that sounds about right these days
A former boss of mine once bought a vintage European truck from an auction outside the US. He was pretty wealthy. Had no idea what the chicken tax was or that it applied to the truck he bought used and was losing his mind over that tariff. So hopefully a few of them at least get a sting.
I’m just here for the pictures 🙂
I bet Harley-Davidson execs are p*ssed off that there’s no tariff on imported motorcycles.
Still won’t make them reliable or value.
Oh, there will be, just not in the US.
Welcome news, but I can’t say it will change my life. Fun to dream, though.
I’m 6 years out from being able to import my dream holden ute.
I hope that you are released from federal labor camp by then.
There’s still new rulesabout kei cars and other grey imports still being made at the State level. Illinois is doing this like New Hampshire and lots of other states, as in your previous article Mercedes.
Conflicting information and confusing lack of detail from this administration? Short-sighted virtue signaling that has no basis in rational thinking? Heaven forfend!
Pretty sure your import will get whacked with the 24% reciprocal on Japan though.
This whole nightmare has made me very glad I brought my car over a few months ago. But also, as long as this loophole lasts, I highly recommend the non-fancy import daily driver life, it’s great!
I’m still confused about whether or not tariffs will be applied to vehicles and parts that conform to USMCA. Good news about the 25 year old stuff at least. We’ll all be riding around in 25 year old right hand drive Vauxhalls at this rate.
Never! I’d prefer a much older Vauxhall, thank you.
That might be the first time anyone has ever preferred a Vauxhall to anything.
What about parts? Same issues? 25 years or older exempt?
New parts were hit hard, it really depends on the HTS code assigned to them.
LHD and full size RHD imports are going to flourish. It’ll be cheaper to import a foreign car with a boot full of parts than buy a used car here. Any vehicle already here will be made more expensive thanks to these (inflationary) tariffs. People looking for a reliable daily may just start driving old European market cars. Which are less safe and more polluting than newer cars.
On the flip side, brown manual diesel wagons may become more accessible!
…import a foreign car with a boot full of parts…
Speaking from experience, if we’re talking about importing something across an ocean, this only works for a car sent inside a shipping container, which isn’t all that cheap of an option. Roll-on/roll-off vehicles have to be empty except for customary items such as an owner’s manual, spare tire, and jack. Anything else is a big (and closely enforced) no-no.
Correct, loose items like parts and knick-knacks aren’t allowed on RoRo vessels. If you tried, anyway, chances are those bits would be stolen before the car even got loaded onto a ship.
If there is a loophole, this Administration will find a way to close it.
Because the Oligarchs need us to pay for their tax cuts one way or another.
It also seems the focus is on reciprocal teriffs. Japan, South Korea and maybe Taiwan are more likely to lower terrifs on US goods. As well as buy high value US manufactured goods from the aerospace and defense industries. It will be interesting to see what happens if it does go free trade with those countries.
Odds are on higher reciprocal tariffs from them. They rarely work to open a market, but just increase retaliation.
Historically yes but times are different it’s hard to say which way it will go and if they are genuine about it. AG and energy products seem to be the only areas most countries are worried about US imports. It may make financial sense for SK, JP, and TW to just take the imports and subsidize sectors effected.
My question is how does this apply to show and display imports. Those tend to be very pricy to begin with, then adding a 25% Tariff onto them would be pretty brutal.
If you have enough money to bring a car in under show and display, you can probably afford to just shrug at the tariff.
yes, no, maybe.
Taxes and death, now with more taxes. maybe. sorta.
With RFKJ at the helm of the HHS and the impending dismantling of the CDC, I think you can safely add more death as well as taxes.
Why would they be subject to tariffs? The point (seemingly – the whole thing is nonsensical) is to move production to the U.S. A 25 year-old any car isn’t going to affect production anywhere.
25 year old imported trucks still get hit with the chicken tax which is just a tariff, so while I agree with you, everything indicated they would be.
I was unaware that the Chicken Tax still applied to 25 year-old used light trucks. Everything I’ve read on the topic over the years has focused on new vehicles.
Yeah makes sense. I’ve been playing with imports for several years now and if you can even find trucks they’re always crazy expensive. Well except for keis, but kei cars are so cheap that the 25% doesn’t really matter. A decent Hilux or similar is crazy expensive
And what you say makes sense. I’m not a truck guy, and I’m definitely not looking to import an old truck, so this aspect of the issue never came to my attention. I searched for conversations about the Chicken Tax on The Samba, the aircooled VW site I frequent, and while there as some conversations about it, none were too frequent. It’s been the law of the land for over 60 years and that segment of the hobby just deals with it by not dealing with those vehicles for the most part.
Logic, in my politics?
Why would tariffs apply to countries with which were personally negotiated with free trade deal, that were trumpted as successful?
Because in his words “it was a horrible deal.” Never mind that he negotiated it.
While we’re at it, let slap tariffs on countries like, erm, the Heard and McDonald islands, which have a population of zero.
Zero people anyway, but there must be thousands of penguins who should pay their fair share right!?
You couldn’t make it up.
The worry was that the government might have also wanted to push Americans to buy used cars in the country. When you buy a used Honda in America, all of your money goes to American entities. When you buy a used Honda in Japan, most of your money goes to foreign entities.
There is precedent for it. We still tax all imported trucks 25 percent regardless of their age. Realistically, there’s no reason to tax a vintage imported truck 25 percent, but we do it, anyway.
There was no such thing as an “imported vintage truck” when the Chicken Tax was implemented in the mid 60s, and not a large enough lobby or constituency to redress the issue in the convening 60 years. Since the President’s obsession (today) is on bringing manufacturing and jobs “roaring back, the likes of which you’ve never seen…”
My question is whether this new tariff scheme renders the Chicken Tax null and void…
revenue
That. A way to raise taxes (to replace the free ride the 1% will get) while denying that they’ve raised taxes.