Company: GPI
Filing Date: 2025-07-24
Form Type: 10-Q
Source: 0001031203-25-000049
Chunk: 88

Company: GROUP 1 AUTOMOTIVE INC
Filing Date: 2025-07-24
Form: 10-Q
Item: Part I, Item 2
Chunk 88
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 tariff rate; and (iii) automotive parts that are products of the U.K. and are for use in U.K.-made vehicles will be subject to a total tariff rate of 10 percent.

The U.K. government has established mandated targets for the sale of new zero emissions vehicles with increasing targets in future years. On April 6, 2025, the U.K. Prime Minister announced planned changes to the EV mandate, which aim to allow carmakers more flexibility in reaching their goal to phase out internal combustion engine vehicles. The plan increases flexibility of the mandate through 2030, allowing more EV’s to be sold in later years as demand increases. Further, the plan allows for the continued sale of hybrid vehicles, which can be operated by both internal combustion and batteries, through 2035 to help ease the transition. Beginning July 16, 2025, U.K. car manufacturers can apply for Electric Car Grants, which will discount eligible new EV’s for consumers at the point of sale. Additionally, on June 12, 2025, President Donald Trump signed resolutions revoking California’s authority to enforce regulations it set forth, including Advanced Clean Cars II (“ACC”), which imposes stricter emissions limits for vehicles and implements a ban on the sale of new gas-powered cars by 2035. California and ten other states set to implement ACC-like rules have sued the Environmental Protection Agency and President Donald Trump and are seeking to enjoin the resolutions. The impact of these changes on our vehicle mix and results of operations cannot be predicted with certainty at this time.

On April 2, 2025, President Donald Trump signed an executive order setting a 10 percent baseline tariff on imports, with higher rates for countries running trade surpluses with the U.S. By April 9, 2025, a follow-up order paused most of the higher reciprocal tariffs for 90 days but kept the 10 percent baseline and raised Chinese tariffs. Throughout the three months ended June 30, 2025 (“Current Quarter”), the U.S and China continued to negotiate the temporary reciprocal lowering of tariffs. On July 7, 2025, President Donald Trump extended the tariff modifications through August 1, 2025. 

On March 26, 2025, President Donald Trump signed a proclamation under Section 232 of the Trade Expansion Act imposing a 25 percent tariff on imported automobiles and certain automobile parts. As of July 24, 2025, the procedures required by the Secretary of Commerce to impose these tariffs have not yet