New York, April 29: U.S. President Donald Trump has agreed to reduce the burden of high customs duties on automakers, a decision welcomed by the American auto industry just ahead of his 100-day rally in Detroit on Tuesday.

According to The Wall Street Journal, automakers previously paying a 25% tariff on imported cars will now be exempted from additional duties on raw materials like steel and aluminum. The administration is also preparing to offer reimbursements for certain foreign auto parts, with the change expected to take effect in May.

U.S. automakers have long been hard-hit by tariffs, especially on imports from Canada and Mexico—key sources of car parts and assembled vehicles. Trump’s earlier renegotiation of the North American Free Trade Agreement (NAFTA) led to mixed outcomes, but companies had continued investing in North American markets.

However, rising input costs from tariffs threatened to push up car prices and cut into sales, potentially putting jobs at risk. Analysts say the new tariff relief could help stabilize prices and protect employment in the sector.

Commerce Secretary Howard Lutnick said the change represents a “major win” for Trump’s trade agenda, aimed at rewarding domestic production and encouraging foreign investment in U.S. plants.

General Motors CEO Mary Barra praised the move:
“We are grateful to President Trump for supporting the American automotive industry and the millions of Americans who depend on us.”

The move is likely to resonate with Michigan voters ahead of the Detroit rally, where the president is expected to highlight his economic achievements.