The American Automotive Policy Council (AAPC) has called for the reinstatement of USMCA preferential treatment.

The AAPC represents the common public policy interests of U.S. automakers: Ford Motor Company, General Motors Company, and Stellantis.

USMCA preferential treatment

In a letter to the USTR, the AAPC called for the current automotive rules of origin to be largely maintained. It also proposed aligning their application across all trade agreements. At the same time, it suggested specific adjustments to reduce compliance burdens. In this way, it sought to encourage investment and strengthen the U.S. automotive industry.

However, administrative burdens remain that complicate the operation and application of the USMCA. Therefore, the AAPC suggested mechanisms to address these obstacles. The proposal also aims to preserve consistency with the core objectives of the agreement.

“(It is necessary) to fully restore the preferential treatment of the USMCA to help protect the regional and global competitiveness of U.S. automakers,” said the AAPC.

Joint review

The original USMCA negotiating team defined a regional and integrated automotive framework. A 21st-century design. The goal was for U.S. workers and manufacturers to capture the main benefits of the automotive industry’s growth under the agreement.

Later, during the joint review with Mexico and Canada, the AAPC proposed preserving, to a large extent, the current frameworks. It also proposed resolving pending disputes. Above all, it sought to establish clear and agreed-upon rules to anchor and accelerate new investments.

From its point of view, certain improvements could further enhance the effectiveness of the USMCA in promoting additional regional and domestic investment. 

Furthermore, the AAPC shares the concerns of the Trump administration that, in the absence of clear rules on the content of certain “foreign countries of interest,” the benefits for “opportunists”—i.e., manufacturers who supply goods originating outside the USMCA region—will increase.

Therefore, the AAPC urged the USTR to use the joint review to clarify the treatment of such content to ensure that USMCA parties reap the benefits of trade in North America. 

Given the enormous capital investments, long vehicle design life cycles, and complexity of supply chains, the automotive sector prioritizes transparency, predictability, and consultation when making investment decisions. 

Consequently, the AAPC requested that in the future, any substantial changes must ensure long transitions and gradual implementations.