President Trump signs executive order to reduce auto tariffs; Tesla is the only company that meets the '85% domestic content' requirement to be completely exempt from tariffs
President Donald Trump signed an executive order to reduce or exempt tariffs on automakers that manufacture cars in the United States. If 85% of the parts that make up a car are made domestically, the tariffs will be completely exempt, but Tesla is the only company that meets this condition.
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Only Teslas Exempt from New Auto Tariffs Thanks to 85% Domestic Content Rule - FuelArc News
https://fuelarc.com/cars/only-tesla-exempt-from-new-auto-tariffs-thanks-to-85-domestic-content-rule/
Trump Eases Auto Tariffs With 85% Rule While Buyers Brace For Sticker Shock | Carscoops
https://www.carscoops.com/2025/04/trump-eases-auto-tariffs-last-minute-as-buyers-brace-for-sticker-shock/
In the United States, talks are underway to impose a 25% tariff on automobiles and auto parts, but there is opposition from the automobile industry, and various relief measures have been decided. One is a mechanism to prevent multiple tariffs, such as those on steel and aluminum, from overlapping. In addition, a refund measure for tariffs on parts is also available. The refund program will be phased in over three years, with up to 3.75% of the tariffs being refunded in the first year and 2.5% being refunded in the second year. The program will end in the third year, and Commerce Secretary Lutnick has said that it will not be extended.
In addition, a rule was set that 'if a car is manufactured in the United States and contains at least 85% of USMCA (United States-Mexico-Canada Agreement) components, it will be exempt from the obligation to pay tariffs in the first year. However, according to the automotive news site FuelArc News, only Tesla meets this condition.
According to FuelArc News, the car with the highest percentage of domestic parts is Tesla's 'Model 3 Performance' at 87.5%, followed by Tesla's 'Model Y Long Range' and 'Model Y' at 85%, which are the only cars that meet the '85% domestic rule'. Following them are Tesla's 'Cybertruck' at 82.5%, Tesla's 'Model S' and 'Model X', Ford's 'Mustang GT AT', 'Mustang GT 5.0L', and 'Mustang GT Coupe Premium' all at 80%, and Honda's 'Passport AWD' at 76.5%.
Commerce Secretary Lutnick also said the requirement would apply to 'foreign automakers that build vehicles in the United States.'
Ford CEO Jim Farley said he 'supports the president's vision' for this initiative. Stellantis NA's John Elkann also said, 'We appreciate President Trump's decision to implement tariff relief measures.' General Motors CEO Mary Barra also expressed a favorable view, saying, 'This will help level the playing field for companies.'
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in Vehicle, Posted by logc_nt