The U.S. International Trade Commission is examining how the United States-Mexico-Canada Agreement's automotive rules of origin affect U.S. competitiveness in automotive production and trade amid technological changes.
The USITC opened the fact-finding investigation on Feb. 19 as part of the third of five biennial reports required under the USMCA Implementation Act. This report, due on July 1, 2027, follows two earlier studies examining the agreement’s automotive rules of origin.
The USITC will provide evidence on the impact of the USMCA's auto rules on the production and trade of automotive goods, taking into account developments in technology and production processes.
Experts are watching closely to see how these findings might influence supply chains for advanced vehicles. Micah Burbanks-Ivey, an associate attorney at Holland & Knight, said he is particularly interested in how the study addresses strategic components for advanced and electric vehicles, such as critical minerals, batteries and semiconductors.
However, not all the components are covered extensively in the USMCA, Burbanks-Ivey said.
"I think [the USITC report] could critically shape some of these rules of origin, and, in a second order, the supply chain for these products," he said.
The automotive rules of origin are the detailed criteria determining whether a vehicle or auto part has sufficient content from member countries to qualify for tariff-free treatment under the USMCA. Rules cover passenger vehicles, light and heavy trucks and certain automotive parts.
The second USITC report, released in 2025, found that electric vehicles had led to divergences between tariff classifications and rules of origin (ROOs).
"Although most motor vehicle producers indicated that the ROOs continue to be relevant, several indicated that some of the ROOs may be less—or no longer—relevant in the future," the report said.
The rules may not have fully accounted for nontraditional automotive components such as e-axles, semiconductors, cameras, touchscreens, and advanced batteries, per the report.
"In particular, more than half of motor vehicle producers raised concerns about the cost or availability of lithium-ion batteries produced in USMCA countries," the USITC said.
The first two USITC reports also showed shifts in sourcing due to the USMCA's ROOs, including reductions in imports of engines, transmissions, bodies, chassis, axles and steering systems from non-USMCA countries.
In the upcoming probe, the agency will also examine auto prices, employment and salaries. In addition, the investigation will assess broader economic indicators such as U.S. investment and gross domestic product.
The USITC is seeking industry input through a public survey on its website and a public hearing scheduled for Oct. 14.
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