U.S. electrical manufacturers are looking to get around heavy tariffs and geopolitical strife by taking action to promote domestic production. Can they depend on Congress and the Trump Administration for support?
Under the authority of section 232 of the Trade Expansion Act of 1962, President Trump has imposed tariffs of 50% on the full value of imported steel and aluminum and 25% on derivative products, with certain exemptions. Section 232 allows such presidential action when the administration finds that imports are threatening national security due to allegedly unfair trade practices.
The law gives the President extensive leeway in declaring the presence of such threats. Critics argue, for example, that imports of bathroom vanities and house furniture, both hit with section 232 tariffs, are hardly undermining the nation’s security posture. Trump obviously disagrees. More to the point, section 232 actions also cover imported critical minerals, including rare earth metals, that are essential to the manufacture of a wide range of high-technology products.
All of those tariffs are posing a significant challenge to American producers, notes Patrick Lozado, senior director of global policy with the National Electrical Manufacturers Association. NEMA represents more than 300 domestic makers of electrical equipment and systems. While its membership employs more than 580,000 workers in the U.S., it also constitutes the second-largest importer and third-largest exporter of manufactured goods.
Trump has permitted some reductions or exemptions to the steel and aluminum tariffs, particularly for derivative products from Canada and Mexico, but Lozada says more needs to be done to incentivize American manufacturers to ramp up domestic production.
To that end, NEMA has submitted comments to the office of the U.S. Trade Representative, encouraging the building of partnerships with other countries “to ensure consistent and reliable access to critical materials,” Lozada says, adding that it’s been a challenge for producers to obtain rare earths from China despite an agreement with that country secured last year.
NEMA told USTR that while it appreciates the agency’s efforts to deal with structural excess capacity in the industry, “addressing this problem with broad tariffs … risks raising costs for downstream manufacturers, customers — and eventually utility ratepayers.”
NEMA asked USTR to consider “whether tariffed products support the U.S. power grid, AI infrastructure or the manufacture of equipment essential to both — thus affecting energy affordability.”
Even as it pushes the Trump Administration to reconsider its policy on tariffs, NEMA is taking steps to bolster domestic production of electrical equipment. It’s pushing for what it calls a “tariff incentive framework” that would accelerate onshoring through initiatives such as the organization’s “Make It American” program. Launched last year, the latter is a voluntary third-party domestic content certification program for federally funded infrastructure projects such as new airports and water treatment facilities. It would ensure that products and manufacturing sites are complying with the Build America, Buy America (BABA) rules established by the Infrastructure Investment and Jobs Act of 2021.
“As we’re seeing companies bringing their supply chains closer to the U.S., this is a way that they can certify the contents of most products,” says Alexa Burr, NEMA’s senior vice president of strategic growth and membership.
NEMA’s tariff incentive framework is intended to “operationalize the goal of creating more manufacturing in the U.S., while at the same time addressing concerns around increasing tariffs,” Lozada says. The idea is that domestic producers would get an offset from tariff payments based on the amount they’ve invested in manufacturing in the U.S. Lozada notes that such a program has already been applied to industries such as automotive and pharmaceuticals, “but we’re saying we need this for the electrical sector.”
“We’re not asking for handouts,” he adds. “We’re asking for recognition that we’re doing a lot to invest here. Our members have pledged to invest more than $14.1 billion in the U.S.” (A survey of NEMA members in September of 2025 found member executives declaring a total domestic investment commitment of $60 billion over five years.)
NEMA’s chances for success are hard to gauge, at a time when tariff policy is so volatile, and further complicated by Trump’s apparent withdrawal of support for a renewed United States-Mexico-Canada Agreement. Still, Burr says, the group is seeing “really great bipartisan support” for its “Make It American” program.
Adds Lozada: “We’re optimistic that policymakers will continue to understand the importance of the electrical industry, and hopeful that it will take action to support the needs of a growing grid.”
