With President Trump’s big tariffs only a day away, a new report finds huge price increases are coming for Americans looking to buy a new car or truck.
The Anderson Economic Group (AEG) found that vehicles like EV crossovers could have price hikes of over $12,000 depending on the vehicle if proposed tariffs of 25% go into effect on Canadian and Mexican imports. On Monday afternoon Trump confirmed the tariffs will go into effect Tuesday.
The tariffs don’t just affect vehicles imported from those countries, but also parts that cross over the border many times during the production process, adding to additional tariff costs. The costs would almost all be passed on to US buyers, the study said.
Other popular vehicles, like a standard, gas-powered crossover, could see hikes of at least $3,500, while pickup trucks — a staple of working-class Americans and small business owners — could see costs jump as much as $8,000 due to the tariff effect.
Full-size SUVs could see costs rise by $9,000, and small cars could see a hike of $6,200.
Even more shocking is that AEG’s report doesn’t include the effect of Trump’s steel and aluminum tariffs, which would hike production costs even more.
Tariff price hikes arrive just as the average cost of a new vehicle hit $47,465, per research site Edmunds, with nearly 1 in 5 consumers paying $1,000+ in monthly car payments.
Trump, who will address both houses of Congress on Tuesday night, said last week that tariffs were back on the table for Mexico and Canada following a monthlong negotiation timetable that is expiring. The tariffs come as the most recent CPI report showed prices rising more than expected.
Last week, executives from GM (GM), Ford (F), and Stellantis (STLA) held a meeting with the Commerce Department to “warn of the dire economic consequences of the proposed tariffs,” per a report from Bloomberg.
Ford and Stellantis pressed the White House to target the millions of imported vehicles with no US parts content, a source told Bloomberg. Ford CEO Jim Farley complained in the past that automakers like Hyundai and Kia face no new tariffs despite building many of their vehicles in Korea, which the US has a free trade agreement with, similar to Mexico and Canada with the USMCA.
“What doesn’t make sense to me is why we’re having this conversation while [South Korea’s] Hyundai-Kia is importing 600,000 units into the US with no incremental tariff, and why is [Japan’s] Toyota able to import a half a million vehicles into the US with no incremental tariffs?” Farley said during Ford’s Q4 earnings call. “I mean, there are millions of vehicles coming into our country that are not being applied to these, so if we’re going to have a tariff policy … it better be comprehensive for our industry.”
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