Government's Byzanitine Auto Parts Import Cash Giveaway Rules
Published Date: 7/29/2026
Notice
Summary
On May 15, 2026, the International Trade Administration published a Notice titled "Amending the Procedures To Administer Import Adjustment Offset Amounts for Certain Imports of Automobile Parts Under Proclamation 10908 to Include Medium- and Heavy-Duty Vehicle Parts" (May 15 Notice), which established amended procedures for automobile and medium- and heavy-duty vehicle (MHDV) manufacturers to apply for and use the import adjustment offset amounts established by Presidential Proclamation 10925 of April 29, 2025, "Amendments to Adjusting Imports of Automobiles and Automobile Parts Into the United States", and Presidential Proclamation 10984 of October 17, 2025, "Adjusting Imports of Medium- and Heavy-Duty Vehicles, Medium- and Heavy-Duty Vehicle Parts, and Buses Into the United States." This notice provides procedures to allow domestic manufacturers of automobile engines and MHDV engines to claim import adjustment offsets for imports of parts in a manner consistent with those Proclamations. The procedures exclude certain engine assembly operations determined to be limited production operations from being considered in the calculation of offsets.
Analyzed Economic Effects
4 provisions identified: 1 benefits, 2 costs, 1 mixed.
3.75% Engine Import Offset Available
If you assemble automobile or medium- and heavy-duty vehicle (MHDV) engines in the United States, you can apply for an import adjustment offset equal to 3.75% of the aggregate value of engines you assembled in the relevant annual period. Offsets may be used to reduce tariffs under clauses 1, 7, or 12 of Proclamation 10984 or Proclamation 10908 on MHDV or automobile parts, can be carried forward indefinitely until used, and apply to specified annual periods (MHDV years run Nov 1, 2025–Oct 31, 2030; automobile years run May 1, 2026–Apr 30, 2030).
Core-Component Test Limits Eligibility
To qualify for engine offsets, your U.S. engine production must use U.S.-originating core engine components. In years 1–2 only models that rely on two or more U.S.-originating core components are eligible; in year 3 and later only models that rely on four or more are eligible. Core components include turbochargers (including superchargers) and certain parts identified in USMCA Table A.2: heads, blocks, crankshafts, pistons, and rods. A component is U.S.-originating if it is substantially transformed in the United States; blocks and heads also qualify if they underwent all or substantially all machining in the United States.
Application, Documentation, Audits, and Use Rules
To get offsets you must apply starting July 29, 2026, submit detailed production forecasts, engine value calculations, prior-year production data, tariff liability estimates, a list of authorized importers, and a signed certification; submissions go to the Commerce email provided. Commerce and U.S. Customs and Border Protection (CBP) will review and may audit submissions; each response is estimated to take about 40 hours. Approved offsets are administered at entry by CBP, may only be used by approved importers, may not exceed tariff liability, and may not be traded, sold, or transferred.
Aftertreatment Systems Excluded from Engine Value
The value of aftertreatment systems cannot be included in the engine aggregate value for offsets unless the aftertreatment system is assembled as part of the engine at the engine manufacturing facility. If an aftertreatment system's value was already included in a prior automobile or MHDV submission under the May 15 notice, it cannot be included again in an engine submission.
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Key Dates
Department and Agencies
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