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Almost as swiftly as he has erected his tariff wall around the US over the past 100 days, President Donald Trump has issued exemptions for a select but growing family of products like auto parts and smartphones.

One group of companies, though, is engaged in an increasingly urgent waiting game: Those looking to import the machinery from China they say they need to set up or expand their US manufacturing facilities — precisely the production boost that Trump has billed as the ultimate goal of his tariffs.

In recent months, more than 180 companies have filed more than 1,100 individual requests for exclusions, pleading their case for Chinese-made machinery to achieve their domestic industrial ambitions.

The applicants range from leviathans like Ford Motor Co., Hitachi Ltd. and Tesla Inc. to relative minnows like an Ohio company that sells industrial sewing machines used to make leather items, including custom saddles for jockeys in this weekend’s Kentucky Derby.

The calls come amid broader anger over tariffs and surveys showing manufacturers are already starting to rein in production as a result of the tariffs and uncertainty surrounding them. A report Thursday showed factory activity shrank in April by the most in five months, posting the steepest contraction in output since 2020.

Current and former Trump officials have acknowledged the need to provide incentives and exemptions for producers. Treasury Secretary Scott Bessent has floated tax breaks such as allowing companies to claim back the entire cost of buildings and equipment they build in the US, something that could be undermined by tariffs on any such machinery.

Robert Lighthizer, Trump’s first-term trade representative who remains close to the president, has also signaled that the new administration will eventually have to establish an exemptions process similar to the one his office ran during the first term. “They are now migrating to the point where they are going to have exclusions,” Lighthizer told the Council on Foreign Relations on April 28.

Almost 60% of imports to the US are inputs for manufacturing, according to the National Association of Manufacturers, and the group has asked the Trump administration to exclude critical components and raw materials. But the request is particularly important for equipment needed to run factories with uncertainty weighing on plans, said Charles Crain, managing vice president of policy.

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Eventually exemptions for imports of manufacturing equipment seem inevitable, said Deborah Elms, head of trade policy at the Hinrich Foundation.

‘Little Sense’

“Especially since one stated goal of the US tariff policy is to reshore manufacturing, it makes little sense to throw additional tariff obstacles in the way of allowing firms to meet that objective,” she said.

The problem is the exemptions, particularly on goods from China, are caught up in the broader fight between the world’s two largest economies. Both sides have quickly escalated and are showing few signs of backing down.

”The first question from me is, ‘When will the China tariff rates settle?’” said Kelly Ann Shaw, who served as deputy assistant to the president for international economic affairs under Trump and is now a partner at the law firm Hogan Lovells.

She argues the 145% US tariffs on all Chinese imports and China’s 125% retaliatory tariffs won’t last for the next four years. But “I don’t expect to see any formal exclusion process without more clarity and stability in the relationship,” Shaw said.

Until recently, the Trump administration publicly rejected even the notion of any tariff leniency. Some trade hawks in the administration have been eager to avoid a repeat of Trump’s first term, during which companies lodged more than 30,000 requests for exemptions to his initial China tariffs.

But since launching his bigger tariff plans April 2, Trump has responded to persistent personal lobbying by CEOs to add to a list of exclusions decided on via an opaque and informal process.

That has left frustrated companies scrambling to lodge requests wherever they can. It’s also given new relevance to an obscure bureaucratic process — launched last October by the Biden administration — where the requests for clemency on imported Chinese machinery now reside.

Those applications are in bureaucratic limbo, with companies saying they haven’t had any response. The Trump administration has not said whether it will even consider the applications. Neither the Office of the US Trade Representative nor the White House responded to requests for comment.

March Deadline

But amid the lack of any other official process, companies have seen the process as a way to at least get in requests as Trump has raised the tariffs on Chinese imports alone to 145%. A majority of the 1,111 applications have come since Trump took office, with more than 730 coming in March ahead of a March 31 deadline, according to a Bloomberg analysis of the applications.

“Granting a tariff exclusion for manufacturing equipment incentivizes and accelerates US manufacturing and US development of industries which China may have a strategic interest in,” executives at Trump mega-donor Elon Musk’s Tesla wrote in one of four requests filed March 31. “Tesla seeks this exclusion to specifically increase its US manufacturing capacity.”

The company, which in recent weeks has warned investors that tariffs and a broader economic slowdown are likely to hit its bottom line, did not respond to a request for comment.

In an April call with investors, Tesla chief financial officer Vaibhav Taneja said Tesla’s energy unit, which represents a small but growing portion of the EV maker’s business, would see “outsized impacts” from tariffs because the company sources LFP battery cells from China.

Taneja said the company is in the process of commissioning manufacturing equipment to make such cells in the US because existing equipment can’t service the needed capacity.

Fellow carmaker Ford has lodged a dozen different exclusion requests related to imports of machinery it needs to get a Michigan battery plant up and running by next year.

In a March 31 application for a “jelly roll wrapping and insertion machine” used to make lithium ion batteries, Ford representatives wrote that it would help them meet the requirements of the US-Mexico-Canada Agreement that Trump negotiated in his first term.

“But in order to achieve these outcomes in the coming years, we need access to the JR machines in question,” they added, pointing out that nothing similar was made in the US.

Waiting for Response

Hitachi Global Air Power, a unit of the Japanese industrial giant which has lodged 141 applications for exclusions from the China tariffs, said in a statement that the requests it filed in March were all related to parts needed to make air compressors at its plant in Michigan City, Indiana, where the company employs some 700 people.

“We are waiting for a final ruling from the Office of the United States Trade Representative,” the company said.

Fellow air-compressor maker Ingersoll Rand Inc., which submitted more than a dozen requests in November 2024 for machines related to its production of compressed-air units, played down the significance of the filings in an email as “a routine part of doing business in a global business environment.”

For many smaller companies, the requests are about survival.

Ryan Neel, whose Neel’s Saddlery and Harness distributes Chinese-made industrial sewing machines in the US, says the last container of machinery free of tariffs came in last week. Neel, who is based in Ohio, has frozen all future orders until the duties come down or his application for an exemption succeeds.

Lost Sales

Neel has six months of inventory on hand. But he’s already been forced to tell a client he can’t fulfill a $160,000 order because of the tariffs, which now stand at 152.5% on the machines he imports.

“We can’t bring anything in and hope to make a nickel on it,” Neel said.

Footwear manufacturer Evolutions Brands wants to set up a factory in Texas and eventually move production from Mexico. Those plans are on pause.

“With the tariffs, it becomes impossible to get machinery,” said Nora Orozco, who founded the company with her husband 30 years ago.

Evolutions Brands filed more than 20 exclusion requests for machines it says aren’t made in the US. The company has about 50 employees and plans to add 200 more if it gets the US factory up and running, Orozco said.

“This has been our dream to have a US factory,” she said.

--With assistance from Kara Carlson, Kiel Porter and Keith Naughton.

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