The Blubber

‘Finish your cars in America and you win’: Commerce Secretary says Trump’s auto tariff relief is meant to bring manufacturing home

As reported earlier, President Donald Trump is set to sign an executive order today that will ease part of his newly imposed 25% auto tariffs for carmakers assembling vehicles in the United States. The move is intended to give manufacturers time to relocate supply chains back to the U.S., according to Commerce Secretary Howard Lutnick.

Speaking to reporters, Lutnick explained that automakers would be eligible for credits covering up to 15% of the value of vehicles produced in the U.S. These credits can be applied against the cost of imported parts, making it easier for domestic producers to reestablish local supply chains. The measure will be phased in over a three-year period.

Lutnick emphasized that any vehicle finished in the U.S. with 85% domestic content would be exempt from tariffs entirely. However, the 25% auto tariff will still apply to foreign manufacturers operating U.S. plants. “This is ‘finish your cars in America and you win,’” he said.

Additionally, vehicles and auto parts already subject to the 25% Section 232 tariffs on steel and aluminum will be exempt from other Trump-era tariffs, including the 25% duties on goods from Canada and Mexico, and the 10% tariffs covering most other nations, according to Reuters.

Lutnick said these tariff modifications are designed to give U.S. automakers room to expand domestic operations and hire more American workers. He noted that discussions with carmakers revealed even minor tariffs had been a deterrent to investment and job growth. In response, Trump agreed to provide targeted relief to support hiring plans.

The administration has granted automakers a two-year window to restructure their supply chains—after that, Lutnick said, there will be no extension into a third year.