U.S. seeks input on trade deal exempting HVAC products from tariffs

The U.S. Trade Representative (USTR) will host a public hearing next month on the trade agreement between the U.S., Mexico, and Canada that has helped the HVAC industry avoid the brunt of tariff impacts this year. 

Catch up quick: In March, President Trump issued a tariff exemption for certain products covered under the ‘U.S.-Mexico-Canada Agreement’ (USMCA), signed in July 2020, including a range of HVAC and water heating products. (The exemption remains in effect.)

• A clause in the agreement requires a formal review every six years, allowing for updates and improvements, with the first set to take place in July 2026.

Why it matters: Mexico is the U.S. HVAC industry’s largest foreign supplier, representing roughly 40 percent of the industry’s manufacturing capacity, Lennox CEO Alok Maskara noted in January. 

What’s happening: Ahead of the hearing, scheduled for November 17, the USTR is accepting written recommendations from U.S. business owners for the agreement, which the Trump administration will consider in next year’s review.

• “The review could lead to modifications that affect tariffs, trade rules, and business operations across North America,” the Small Business Administration wrote in early October. 

What they’re saying: “What was once expected to be a routine assessment aimed at improving implementation is now likely to become a high-stakes negotiation,” wrote the Center for Strategic and International Studies, a nonprofit policy organization. 

• “The Trump administration is poised to seek additional concessions from Mexico and Canada,” it adds. “Both neighbors, already in talks with Washington over tariff relief, are approaching the process with caution.”

What’s next: The USTR will accept written comments until November 3. Submit a comment