“Made in USA” on high. The White House extends tariff breaks for car manufacturers

The White House on Friday announced an extension of existing tariff breaks for some of the country's largest automakers. President Donald Trump's administration also presented details on the announced new tariffs on trucks and buses.

NBC News recalled that in late April, President Trump signed an executive order aimed at preventing tariffs on cars and auto parts. Such double taxation could quickly result in losses for American manufacturers. The regulation also exempted car manufacturers from duties previously imposed on steel and aluminum.

The decision extends the validity of the compensation program from two to five years. “The priority is to increase domestic vehicle production in the United States to provide American workers with good, well-paying jobs,” a senior administration official said Friday.

Many automakers assemble some parts or key components in Mexico or Canada and then bring them to the U.S. for final assembly. These components may cross the border multiple times, incurring further customs duties.

Friday's decision is a response to intense lobbying from the automotive industry. This shows that the economic reform implemented by the current administration is still taking shape, even though six months have passed since its announcement.

In July, Ford CEO Jim Farley indicated that the company's goal was to achieve “tariff simplification.” Ford produces more vehicles in the US than any of the other members of the “Big Three” (General Motors, Ford, Stellantis – formerly Chrysler). Still, the company estimates its annual tariff-related cost will be around $2 billion.

On Friday, a high-ranking administration official explained that the new program is intended to support those manufacturers who – in accordance with the president's will – produce their vehicles in the US. By using American labor, it is possible to maintain competitive prices and increase production.

The White House also announced that from November 1, a 10 percent tariff will be imposed on the import of buses, including school buses, coaches and similar vehicles. Imports from Mexico and Canada will receive “favorable treatment from the USMCA” – the trade agreement between the United States, Mexico and Canada – just as is the case with car imports.

Andrzej Dobrowolski from New York (PAP)

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