The average price tag for new cars sold in the U.S. may increase by thousands of dollars as they face President Donald Trump’s looming 25% tariffs on all imported vehicles and some auto parts, according to industry analysts.
Trump reportedly warned some automakers not to raise the price of their vehicles in response to the ... More
Automotive analysts at Cox Automotive estimated the average cost for new vehicles sold in the U.S. will increase up to 20%, while WedBush analyst Dan Ives said in a note Wednesday that prices would increase by up to $10,000.
Cox Automotive previously suggested new vehicles assembled in Canada or Mexico would have their average price raised by about $5,855, an increase analysts warned would likely “upend” the U.S. automotive industry.
About 22% of all vehicles sold in the U.S. are imported from Canada and Mexico, according to S&P Global, while several automakers rely on assembly and manufacturing for some vehicles in either country, including BMW, U.S.-based General Motors, Nissan, Volkswagen, Toyota and Stellantis, among others.
Prices for new Ford vehicles will likely increase the least compared to the automaker’s competitors, as about 80% of its vehicles are made in the U.S., Cox Automotive told CBS.
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In a call earlier this month, Trump warned CEOs of some automakers not to raise their car prices because of the tariffs, people with knowledge of the call told the Wall Street Journal. Trump reportedly told the executives their companies would benefit from tariffs, which he said would help return manufacturing to U.S. facilities. Trump said earlier this week: “You’re going to see prices going down, but going to go down specifically because they’re going to buy what we’re doing, incentivizing companies—and even countries—to come into America.”
Tesla will be “best off” from Trump’s tariffs when compared to Ford, General Motors, Chevrolet and Stellantis, Deutsche Bank analyst Edison Yu wrote Thursday. Tesla assembles all of its cars in the U.S., allowing the company to avoid some of the tariffs, though CEO Elon Musk said the company is “NOT unscathed” and the “tariff impact on Tesla is still significant.” Musk said the tariffs will affect Tesla parts that are imported from other countries, like batteries from China, and noted the “cost impact is not trivial.”
Cox Automotive lowered its full-year forecast of new vehicle sales from 16.3 million to 15.6 million in 2025, citing “economic uncertainty, affordability” and potential impacts from tariffs.
Earlier this week, Trump announced a 25% tariff on all cars and trucks imported into the U.S. that would take effect on April 2. Trump referred to the tariff as the “start of liberation day,” suggesting the move would accelerate “tremendous growth in the automobile industry” as automakers build more U.S.-based plants. Ford CEO Jim Farley has warned the automotive tariffs would “blow a hole in the U.S. industry that we’ve never seen,” while earlier talks of tariffs produced “cost and chaos” for automakers. Trump has threatened reciprocal tariffs would also go into effect in early April, after already implementing a 20% tariff on goods from China. A 25% tariff on Canadian and Mexican imports was delayed until April, a move that will likely impact prices for goods like electricity, alcohol, gas and lumber, among others.
Trump Announces 25% Tariffs On Imported Cars—Here’s What We Know (Forbes)
‘Tesla Wins, Detroit Bleeds’: Why Elon Musk’s Tesla Is Less Impacted By Auto Tariffs Than Peers (Forbes)
Trump Says He’ll Be ‘Lenient’ On Reciprocal Tariffs: Here’s What To Know As ‘Liberation Day’ Looms (Forbes)