Trump’s autos tariffs could quickly make car prices more expensive

President Donald Trump threatened to place a tariff of around 25% on cars imported into the United States, a policy that could raise prices on cars from most automakers – including American car brands – almost immediately after the tariffs are imposed.

President Donald Trump threatened to place a tariff of around 25% on cars imported into the United States, a policy that could raise prices on cars from most automakers – including American car brands – almost immediately after the tariffs are imposed. The tariffs could add thousands of dollars to the cost of cars, automotive experts say. That could put the price of cars, already near record highs, out of reach for many buyers. Trump, announcing the 25% tariffs Tuesday, said the tariffs would likely be imposed April 2 after a review period that concludes April 1. He said the tariff would gradually rise, penalizing automakers that export cars to the United States rather than making them in the United States. Trump said the tariffs would be delayed until the spring in part to give automakers time to move their operations to America. But automakers can not move production of cars quickly, even if they have excess capacity at US plants, or have closed plants in the past. It can take years to shift production of cars to a new line. “If the administration moves forward with a 25% tariff on all auto imports, car shoppers should get ready for some sticker shock at dealerships,” said David Greene, an industry analyst at Cars.com. Trump also did not say if the tariffs would apply to auto parts, although he did say there would be tariffs on semiconductors, which are an important component of modern automobiles. A shortage of semiconductors coming out of the pandemic caused car prices to soar and production of cars fell and demand was stronger than expected.