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The Trump Administration issued a new Proclamation on June 1 adjusting Section 232 tariffs on steel, aluminum and copper, providing some agricultural and construction equipment manufacturers with temporary relief amid rising production costs.

Section 232 tariffs, which primarily affect imported metals and derivative products, were originally implemented during President Trump’s first term. According to the Administration, the tariffs are intended to support domestic industries and address national security concerns related to imports.

The new Proclamation makes the following adjustments to the tariffs, effective June 8 through the end of 2027:

• A temporary tariff reduction from 25% to 15% on certain types of ag, construction and mobile industrial equipment identified in Annex I-C when imported from qualifying trade-deal countries. (See full list of equipment below.)
• A lower threshold for products to qualify as being made “entirely” from U.S. steel, from 95% to 85%.
• 10% lower tariffs on products made in another country with at least 85% U.S. metals, measured by weight.
• Special provisions for USMCA products, including a 25% duty on only the non-U.S. content of the product.

The White House said the modifications are intended to address national security concerns while encouraging investment and domestic production in sectors including agriculture, housing and manufacturing.

In the Proclamation, President Trump stated that the temporary modifications take into account the role these products play in U.S. economic activity while maintaining the broader tariff framework established under previous Section 232 actions.

The changes could reduce tariff costs for some equipment manufacturers that source components globally or manufacture products outside the United States. The relief comes as OEMs continue to report mixed financial results, with many citing tariffs among the factors affecting their businesses.

Recent reports from OEMs highlight the ongoing impact:

Caterpillar: Consolidated operating profit rose 20% to $3.1 billion in the first quarter, driven by a $940 million positive sales volume impact but offset in part by an additional $710 million in manufacturing costs, including higher tariff-related expenses. The company estimated its full-year 2026 tariff costs between $2.2 billion and $2.4 billion. CFO Kyle Epley said during the earnings call that the estimate does “not currently include any IEPA-related refunds as the result of the Supreme Court’s decision.”

CNH Industrial (parent company of Case and New Holland): Global net sales in CNH’s construction equipment segment were down 3% year-over-year to $574 million. In the first quarter, the construction business posted a $28 million loss in adjusted earnings before interest and taxes. Contributing factors included lower sales volumes in North and South America, higher tariffs, higher trade show marketing costs and labor cost inflation, partially offset by improved equipment pricing.

Komatsu: While the Japanese manufacturer finished its 2025 fiscal year with global and North American construction, mining and utility equipment sales up year-over-year, operating income declined. Global construction, mining and utility equipment net sales increased 0.2% to $24.1 billion, while operating income for the segment fell 18% to $3.1 billion.

Kubota: Consolidated revenue for the first quarter increased 13.7% to $5.1 billion, and operating profit rose 59.1% year-over-year to $616.4 million. The company cited higher sales volumes and pricing adjustments in North America as key drivers, while noting approximately $150 million in additional costs related to U.S. tariffs.

Volvo CE: Volvo CE is shuttering its Rokbak articulated hauler business, citing rising operational and supply chain costs and global trade challenges, including U.S. tariffs. The company said these factors have significantly affected financial performance.

In response to the Proclamation, the Association of Equipment Manufacturers (AEM) issued a statement supporting the changes, stating that the tariff reductions could help lower input costs and ease supply chain pressures for equipment manufacturers and farmers. AEM also said the action reflects the challenges manufacturers face when expanding domestic production capacity while remaining globally competitive.

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