Industry experts warn the tariffs could add over $10,000 to new car prices, pushing the average cost beyond $60,000
President Donald Trump announced a 25% tariff on all imported cars, SUVs, minivans and light trucks, effective April 3. Auto parts tariffs will follow on May 3.
Trump said the move aims to protect US auto manufacturing, which he claims is undermined by imports. Vehicles built in America would be exempt.
Economic impact and reactions
Imports of auto-related goods reached $474.3 billion last year. Industry experts warn the tariffs could add over $10,000 to new car prices, pushing the average cost beyond $60,000.
Global trade impact
The European Union, which imposes a 10% tax on US cars, may adjust its policy. Canada has proposed a $2 billion fund to strengthen its auto sector, while Mexico, the world’s seventh-largest vehicle producer, faces uncertainty as 80% of its auto exports go to the US.
President Trump’s announcement follows his earlier tariffs on steel, aluminum and Chinese goods, escalating global trade tensions.