President Donald Trump’s sweeping tariff plan has rocked global markets. But one turgid addendum issued by US Customs and Border Protection just after his April 2 tariff pronouncement provided relief for those in the collectible car business: Vintage cars would be exempt.
Collectors, brokers and logistics specialists alike had feared the worst when Trump’s March 26 executive order saddled vehicles and auto parts with new 25% tariffs, a tax that would be in addition to the current 2.5% rate and didn’t include any exemptions for used and classic cars.
New customs guidance now outlines a special exemption for “passenger vehicles and light trucks from all countries … manufactured in a year at least 25 years prior to the year of the date of entry.” The old Alfa Romeos and BMWs, Ferraris and Fiats that enthusiasts love to discover abroad can still be sent back home at current rates.
Martin Button, global brand ambassador for CARS, a classic automotive relocation service, had been on the edge of his seat all week. “It’s good news!” he crowed on the phone that evening after receiving an email outlining the exemption.
“We remain hopeful that this move by the US government will influence the importance of classic cars worldwide,” Dmitriy Shibarshin, the global marketing director for West Coast Shipping, said in a statement about the result.
Vintage car fanciers had worried the lack of an exemption would decimate large swaths of an industry that includes 43 million classic cars in the US and a combined value of more than $1 trillion, according to data from insurance provider Hagerty Inc. Auction houses would lose international consigners adverse to paying extra just to sell their cars at the annual sales in Monterey, California; restorers and rebuilders would lose clients frustrated with the rising costs of parts and associated delays for their vintage toys.
On March 27, lawyers from Simon Gluck & Kane LLP had sent a letter to US Trade Representative Jamieson Greer outlining the reasons why an exemption should be applied for certain used automobiles, race cars and parts. Increased duties discourage imports, stripping local and national jurisdictions of tax revenue, it said; the $10 million sale of a collectible car at a rate of 7% generates sales taxes of $700,000.
“Not only would the US Treasury be deprived of the 25% duties which would not be paid,” wrote Christopher Kane, an attorney who specializes in ocean transport and compliance audit procedures at Simon Gluck & Kane, “but the state would be deprived of significant irreplaceable sales tax revenue.”
In California, Button had anticipated turning around full shipments of cars if the exemption didn’t come through.
Jay Bullock, director of global special projects at Silver Tiger Logistics, imagined that his weekly Saturday flight of vehicles would be empty; he had already paused transport on a stockpile of cars in anticipation of the ruling. The shipper with offices in Georgia, the UK and the Netherlands imports roughly 1,000 collectible cars into the US annually, with the total value aboard some single flights exceeding $100 million.
