U.S. Vehicle Tariff Remission Amended

Summary#

The Order Amending the United States Surtax Remission Order (Motor Vehicles 2025) (SI/2025-104) changes which importers and how many U.S.-assembled cars certain Canadian companies can bring in tariff-free. It reduces the tariff-free allowance for at least one automaker after lower Canadian production and expands eligibility to recognize recent investment in Canada’s auto supply chain.

What it does#

• Clarifies the definitions in the remission order so that an eligible “importer” is a person listed in a confidential schedule approved by the Governor in Council.
• Replaces the confidential schedule to:
  • reduce the number of U.S.-assembled vehicles that one or more companies can import duty-free because they lowered production in Canada (production measured April–June 2025);
  • add other companies to the list because they made qualifying investments in the Canadian automotive supply chain.
• Confirms the measure comes into force on the day it was made (the order was made on October 23, 2025 and published in the Gazette on November 5, 2025).
• Keeps the details (which companies and the exact vehicle quantities) out of the public schedule for confidentiality reasons.

Who's affected#

• Canadian-based auto assemblers that were eligible under the original United States Surtax Remission Order (Motor Vehicles 2025). Specific affected companies are not named publicly.
• Importers who rely on the remission to avoid 25% counter-tariffs on qualifying U.S.-assembled vehicles.
• Canada Border Services Agency (CBSA), which administers remission claims and processes refunds.
• Vehicle dealers, fleet buyers and consumers may notice downstream effects if companies change import plans or pass costs on.
• The broader auto supply chain and workers, since the framework ties tariff relief to maintaining production and investment in Canada.

Why it matters#

• The change makes the tariff-free allowance smaller for firms that reduced Canadian production. That can mean those firms will pay tariffs on more U.S.-assembled vehicles, which could affect prices, supply choices and company decisions about where to source cars.
• Expanding eligibility to recognize investments in the Canadian supply chain rewards companies that keep or grow parts production in Canada.
• The remission framework is meant to protect Canadian auto jobs and investment while responding to U.S. tariffs: vehicles must be CUSMA-originating and imported between April 9, 2025 and April 8, 2026 to qualify, and remission claims must be filed within two years of importation.
• For context, in 2024 Canada exported $44.4 billion and imported $35.6 billion in finished vehicles with the United States; the sector supports over 125,000 direct and 425,000 indirect jobs in Canada.
• Because the schedule is confidential, it’s not publicly clear which manufacturers or how large the quota changes are; that limits what outside observers can say about the exact market impacts.