New Philippines-US trade deal sees vehicle import tariffs drop to 0%

Our country’s chief executive and the President of the United States have reached a trade agreement that could potentially boost the position of American automakers in the Philippine market.

President Ferdinand “Bongbong” Marcos, Jr. and US President Donald Trump have both agreed on a new trade deal, one that sees Philippine-made products shipped to the US get charged with a 19% tariff rate, while American-made products, which include cars, will get 0% import taxes when shipped to the Philippines.

Essentially, the zero tariff rate will lead to cheaper landed costs for vehicles, as well as vehicle parts and components made from the US, where savings could be passed on to consumers through more competitive pricing.

This benefits American brands in the country, such as Ford, which sources out models such as the Bronco, F-150, Explorer, and the Mustang from North America. Likewise, Jeep models such as the Wrangler and the Gladiator, the Ram 1500, and the Chevrolet Suburban could see potential price drops because of this trade agreement. Not to mention, even gray market importers are set to benefit from this zero tariff agreement.

But to some extent, the zero tariff agreement could also entice brands such as Toyota, Honda, and Subaru to introduce US-made models in the Philippine market. Toyota could bring in vehicles such as the Tacoma, 4Runner, and Sienna, while Honda could bring back the Pilot and add the Civic Si to its lineup. Subaru, on the other hand, already offers the US-made Evoltis, but the outdoor-oriented Wilderness models of the Crosstrek, Forester, and Outback could potentially make their way here.

The Philippine government is yet to announce the effectivity date of this new trade deal with the US. But stay tuned for more updates.