Trump Makes Changes to Metals Tariffs, Creates Uncertainty Across HVAC Products

APRIL 10, 2026 UPDATE:

A critical change that will impact some HVACR equipment suppliers is the change in treatment of steel and aluminum sourced from the United States. Prior to the latest change, all U.S.-origin steel and aluminum were exempt from Section 232 tariffs to incentivize domestic suppliers of steel and aluminum. The latest change removes that exemption, making it significantly harder to receive preferential tariff treatment for using U.S. metals.

If we look at import data from late 2025 from Mexico, the largest exporter of HVACR products to the U.S., imports faced an effective tariff rate of roughly 8%. Because HVACR products were largely exempt from IEEPA tariffs, nearly all of the tariffs paid were under Section 232. To pay an 8% tariff, that meant that 84% of the metal content was of U.S. origin. Under the new rules, a product that is 84% U.S.-origin metal would not qualify for the 10% tariff but would instead face the 25% tariff on the entire value of the product.

Because the tariff change applies to the entire value of the product and no longer exempts the value of U.S.-origin metal, the effective tariff rate for products made in Mexico will increase significantly, approaching 25%. This will certainly be passed through the supply chain and likely result in significant price increases.

For products made in other countries that are less likely to use U.S.-origin metals, see the original post below for possible tariff changes.

HARDI has reached out to the Administration on the change in treatment of U.S.-origin metals.

APRIL 3, 2026 UPDATE:

Yesterday, President Trump signed a proclamation changing how Section 232 tariffs on steel, copper, and aluminum products are calculated. Section 232 tariffs have been among the most impactful on HVACR and water-heating products. Here is the summary of the changes released by the White House:

• Articles made entirely or almost entirely of aluminum, steel, or copper will pay a flat 50% on their full value — for example, steel coils and aluminum sheet.

• Derivative articles substantially made of steel, aluminum, or copper will pay a flat 25% on their full value.

• Certain metal-intensive industrial equipment and electrical grid equipment will pay 15% through 2027, to accelerate the massive industrial base buildout currently underway across the United States.

• Products made abroad but entirely with American steel, aluminum, and copper will be subject to lower tariffs of 10%.

• Products made of 15% or less steel, aluminum, or copper will no longer be subject to Section 232 metals tariffs.

HVACR products are considered derivative products, and if the total product content exceeds 15% aluminum, 15% copper, or 15% steel (it appears to be each, not cumulative), the product faces a 25% tariff on the value of the entire product. If the product contains no more than 15% aluminum, copper, or steel, it is exempt from the tariff.

The bottom line is that the metal's value is important in determining whether the product’s payable tariff will increase or decrease under the new rules. If we assume that most HVACR products have high metal content as a percentage of the import value, the payable tariff is likely to decrease. For example, if 80% of the import value is derived from the metal content, under the previous Section 232 tariff system, the payable tariff would be 40% of the unit’s total cost (80% value x 50% duty = 40% payable). Under the new tariff system, the payable tariff would be 25% of the value, a significant reduction from the theoretical 40% payable tariff. For products in which the value of the metal accounts for less than half of the product's value, the new system would result in an increase in the payable tariff. For example, if 40% of the value is metal, the previous payable amount was 20% of the total value, but under the new system, it is 25%, an increase.

Tariff Resources for HVACR Distributors

Navigating the tariff landscape is no small feat for HVACR distributors but staying informed and proactive can help mitigate the risks. HARDI’s Tariff Tracker provides real-time updates and insights to help HARDI members and other HVACR professionals stay ahead of tariff developments.

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