US Truck Tariff: Trump’s 25% Import Duty from Nov 2025
US President Donald Trump made a significant announcement on 6 October 2025, declaring that from 1 November 2025, all medium and heavy trucks imported into the United States will face a 25% US Truck Tariff. This move comes under his “America First” policy, aimed at boosting domestic production and reducing dependence on foreign companies. The new US Truck Tariff decision will heavily impact major truck manufacturers from Mexico and Canada, including Navistar, Volvo, Daimler and Paccar.
New Tariff Policy on Truck Imports into the US
According to the Trump administration’s decision, all medium and heavy trucks imported into the US will attract a 25% tariff. As per 2024 data, the US imported around 2,45,000 medium and heavy trucks worth $20.1 billion, including $15.6 billion from Mexico and $4.5 billion from Canada. Most of these trucks are used in logistics, construction and waste management sectors. With the new tariff, the price of Class-8 heavy duty trucks is expected to rise from $170,000 to nearly $212,500 (around ₹35 lakh).
Impact on Mexican and Canadian Truck Manufacturers
The tariff will directly affect Mexican and Canadian truck makers that compete in the US market. Major players such as Navistar, Volvo, Daimler and Paccar will feel the impact of this new policy. Many foreign companies are now considering setting up assembly plants in the US or nearby countries to bypass tariffs and take advantage of exemptions under the US-Mexico-Canada Agreement (USMCA). Under USMCA, vehicles produced within the region with higher local content qualify for tariff-free trade, which is pushing manufacturers to strengthen their local production plans.
Boost for the US Electric Truck Industry
This policy is expected to benefit American electric truck makers like Tesla. As imported trucks become costlier due to tariffs, domestic players will gain a stronger competitive edge, further encouraging the adoption of electric trucks. The move also aligns with the government’s agenda of promoting sustainability and clean technology. Tesla and other US electric vehicle manufacturers are likely to expand their market share as foreign competition becomes less affordable.
Impact on Global Trade and Supply Chain
The tariff is likely to strain trade relations between the US, Mexico and Canada. It may also disrupt North America’s integrated supply chain, as the three countries have deep interlinkages in automotive and truck production. In recent years, the US has imposed tariffs on automotive products from China and Europe as well, creating trade hurdles and intensifying global tensions. While the policy is designed to safeguard domestic industries, it signals potential instability in global trade dynamics.
Implications for India’s Auto Parts Exports
For India, the impact of this decision will be mixed. Although Indian truck makers have a limited presence in the US, India’s auto component exports to the country are strong. In 2023-24, India exported auto parts worth nearly $6.79 billion to the US, with 15–20% linked to commercial vehicles. The new tariff could hurt Indian auto parts exports, especially for companies directly supplying to the US. However, Indian firms with manufacturing units in Mexico and Canada may partly offset the impact, as products made there qualify for tariff exemptions under USMCA. Experts estimate India’s auto component exports could face a 15–20% setback, pushing exporters to adopt new strategies.
Protection and Challenges for US Industries
Donald Trump defended the decision as “essential to protect American workers and industries from foreign competition.” US truck makers such as Peterbilt, Kenworth, Freightliner and Mack Trucks are expected to benefit. However, industry experts warn that higher tariffs will raise truck prices, increasing costs for consumers and logistics firms, which could affect large sectors of the economy. Disruptions in supply chains may also lead to production delays and shortages.
Conclusion
The 25% US Truck Tariff, set to take effect on 1 November 2025, is intended to strengthen the US domestic manufacturing sector, but it will also affect Mexico, Canada and Indian auto component exporters, along with the global trade network. Truck makers in Mexico and Canada are weighing options to relocate production closer to the US to avoid tariffs. The new US Truck Tariff policy will provide a boost to US electric truck makers like Tesla, while Indian auto parts suppliers may face setbacks. Overall, the decision is expected to reshape supply chains and trade relations, marking a turning point for international commerce.
In this way, Trump’s new tariff policy has not only secured the US domestic market but also challenged global economic equations, creating a new set of dynamics for international trade by the end of 2025.
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