News

On January 14, 2025, the Department of Transportation’s Federal Highway Administration (FWHA) published a final rule erasing the long-standing Manufactured Products General Waiver to FHWA’s Buy America requirements. For more than four decades, the general waiver has allowed states and contractors to use foreign manufactured products on federally funded transportation projects. Under the FHWA’s new rule, (1) final assembly of manufactured products must occur in the United States (the “final assembly requirement”), and (2) components mined, produced, or manufactured in the United States must be greater than 55 percent of the total cost of the manufactured products (the “55 percent requirement”). FWHA will impose the new rule in two phases. The final assembly requirement will take effect for projects obligated on or after October 1, 2025. The 55 percent requirement will take effect for projects obligated on or after October 1, 2026.

During the rule’s public notice and comment period, commentators expressed concerns over increased cost and domestic availability of many manufactured products routinely used in federal-aid projects, such as lighting systems, Traffic Management Systems (TMS) equipment, Intelligent Transportation Systems (ITS) equipment, and rolling stock.

Going forward, contractors involved in federal-aid transportation projects should understand FHWA’s new rule and pay close attention to any updates to the rule. They should also discuss the new requirements with suppliers to ensure compliance with the requirements as they take effect on future federal-aid projects.