Automotive industry tariff mitigation strategy

Over the last several months, the United States has, in an attempt by the Trump administration to rebalance the trade deficit, initiated a series of tariff measures against foreign-sourced goods and materials. Despite intense lobbying efforts, the administration continues to push forward with its trade agenda with no clear end in sight.

Andrew Siciliano

Andrew Siciliano

Partner, Trade & Customs Lead, KPMG US

+1 631-425-6057

With tariffs on steel, aluminum, and certain goods and materials from China already in place, the U.S. trade team has negotiated the United States Mexico Canada Free Trade Agreement (USMCA) which tightens the rules on finished vehicles and automotive parts.  There are also ongoing investigations into whether to extend tariffs to the auto industry more generally so auto manufacturers need to begin planning for a changing trade environment.

Several producers of finished vehicles and parts may not qualify under the new USMCA rules unless they make changes to their global supply chain to source products that “originate” in the USMCA region. 

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KPMG's Intelligent Supply Design framework combines our global experience in tax and regulatory matters with our strategic and operational supply chain experience to provide a holistic approach to addressing the ever-changing landscape.

2018 Tariff update and impact analysis
In recent months, the U.S. government has taken significant tariff action, affecting a variety of product in a wide arrange of industries. In light of these developments, KPMG's Trade & Customs team is happy to share this update.
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The U.S. and China have shifted gears from threats to action in an increasingly hostile global trade environment. These times call for quick movement by company leaders to seek out tariff mitigation planning that could help alleviate lost revenue from the increased duty rates. KPMG can help.