Trump Wants Imported Cars To Be Even More Expensive

The car industry got a stay of execution when it came to President Donald Trump’s proposed tariff on Canadian and Mexican products. That tariff may still come into effect, though, and it may soon be joined by yet another. As reported by Bloomberg, the President has announced that a tariff specifically focused at car imports is coming soon. So prepare to pay more for your Volkswagen GTI, Hyundai Kona or even Chevy Trax.

2024 Hyundai Kona

Base MSRP: $24,250
Engine: 2.0L Inline-4 Gas
Horsepower: 147 hp
Fuel Economy: 30/35 MPG

The Severity Is A Mystery

The only real details given about this tariff were that it will affect car imports and go into effect at the start of April. Bloomberg said the President didn’t give numbers on the tariff’s cost nor what countries would or wouldn’t be exempt. It does seem that this tariff would only affect completed vehicles. So, at the very least, imported parts wouldn’t be subject to it, keeping those costs down.

Trump’s New Tariff Could Ruin Your Affordable Pickup Truck Dreams

Trump’s 25 percent tariffs on Canada and Mexico will raise prices on new vehicles and parts all over the auto industry.

Depending on how broad this new tariff is, the number of vehicles affected could be enormous. The U.S. Department of Commerce found that nearly 8.2 million cars were imports in the U.S. S&P Global estimated total U.S. new car sales at around 16 million in 2024, so that means roughly half of all new cars sold in the country last year were imported, regardless of the badge. The country that exported the most cars was Mexico, at about 2.9 million. The next biggest source was South Korea at 1.5 million cars, followed by Japan with 1.4 million, Canada with 1.1 million and Germany with 500,000. The value of all these vehicles tops $240 billion.

The Tariffs Could Start Stacking Up

The biggest question for many automakers, particularly domestic ones, will be whether this tariff will be added on top of that looming 25% tariff on Canadian and Mexican products. As a reminder, that tariff was only delayed until March, so it’s due to start in a couple of weeks. That 25% tariff could also have wider effects than just completed cars coming from the north or south. It will be applied to all products from those countries, so that would affect parts, too. This could raise prices both on repairs as well as vehicles built in America with imported components.

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Ford CEO Says If His Company’s Gonna Get Tariffs, Then So Should Hyundai And Toyota

Jim Farley says that if American companies face tariffs on imported cars, so should all the others.

If Canadian and Mexican cars are exempted from this new import tariff, at least that would help to more evenly impose tariffs on all imports. Ford CEO Jim Farley pointed out how March’s tariff on North American imports would end up targeting Ford and domestic automakers that particularly rely on Canada and Mexico for production, while not affecting imports from outside North America. If there’s no exemption, though, not only would it result in huge tariff costs on North American cars, it would also provide a perverse incentive to not produce cars on most of the continent.

Source: Bloomberg, U.S. Department of Commerce, S&P Global

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