Aircraft, parts from Brazil, EU exempt from reciprocal tariffs

The United States today implemented long-promised reciprocal tariffs against numerous countries, but exemptions are expected to protect Embraer and Airbus from the brunt of the levies. Although the U.S. has imposed a 40% tariff on goods from Brazil, in addition to a 10% tariff implemented in April, the new tariff excludes aircraft and aircraft parts. However, they remain subject to the 10% tariff. “The news confirms the positive impact and strategic importance of Embraer’s activities for the Brazilian and U.S. economies,” Brazil-based Embraer told Cargo Facts . “We continue to believe in, and advocate firmly for, a return to the zero-tariff rule for the global aerospace industry.” Additionally, a U.S. trade agreement announced July 27 exempts civil aircraft and parts from the 15% tariff levied against European Union goods. That deal also removes a 10% tariff on EU aircraft and parts that went into effect in April. Guillaume Faury, executive director and chief executive of Europe-based Airbus, said on the company’s July 30 earnings call that the U.S.-EU deal “will bring our industry back to the tariff-free environment that we have enjoyed since 1979, and which has contributed so much to the success of our industry.” “A stable and predictable trade environment is essential for a highly integrated global aerospace industry.” — Guillaume Faury, Airbus executive director and CEO Airbus is “cautiously monitoring” implementation of the U.S.-EU deal, Faury said. Reciprocal tariffs The United States implemented 10% tariffs against every country except Canada, China and Mexico on April 5 and placed reciprocal tariffs on the backburner to allow time for trade negotiations. Some of the reciprocal tariffs enacted today are significantly different than what was proposed in April. For instance, Brazil was hit with the highest reciprocal tariff of 50% while only 10% had been proposed against the country in April. Others saw the percentage go down; Lesotho went to 15% today from a proposed 50% in April. !function(){"use strict";window.addEventListener("message",function(a){if(void 0!==a.data["datawrapper-height"]){var e=document.querySelectorAll("iframe");for(var t in a.data["datawrapper-height"])for(var r,i=0;r=e[i];i++)if(r.contentWindow===a.source){var d=a.data["datawrapper-height"][t]+"px";r.style.height=d}}})}(); And these numbers can still change. For instance, U.S. President Donald Trump signed an executive order on Aug. 6 that will take effect on Aug. 27 imposing a second 25% tariff on India, bringing the total tariff to 50%, as a penalty for India purchasing oil from Russia. The U.S. lowered its tariff rate on Chinese goods to 30% from 145% on May 14, while China lowered its tariff rate on U.S. goods to 10% from 125%. Tariffs were lowered to support trade negotiations. The three-month reprieve ends Aug. 14. Goods from Canada and Mexico are exempt from tariffs if they comply with the United States-Mexico-Canada Agreement . Noncompliant goods from Mexico are subject to a 25% tariff and noncompliant goods from Canada are subject to a 35% tariff. The tariff against Canada rose to 35% from 25% on Aug. 1. All other countries remain subject to a 10% tariff. Cargo Facts Symposium, the quintessential event for stakeholders and key leaders in the global freighter and air cargo industries, will take place Oct. 22-24 at the Grand Hyatt in Nashville . Learn more and register today to take advantage of the early-bird rate before Sept. 5.

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