Summary
Trump warned automakers not to raise prices after announcing a 25% tariff on imported vehicles starting April 3, claiming the tariffs would be “great” and benefit U.S. manufacturing.
Industry leaders, including GM, Ford, and Stellantis CEOs, expressed concerns about inevitable price increases, with experts warning tariffs could add thousands to car costs.
Auto suppliers stated that absorbing tariffs is impossible, and dealers fear affordability challenges for consumers.
While the United Auto Workers union support the move as a job creator, trade groups predict higher prices and fewer manufacturing jobs.
The problem here isn’t the increased price of goods, it’s the fact that Trump knows increasing the price of non-US built cars via tarrif gives US car companies an advantage that could be used to sell more cars for less money, but will really just give US car companies the opportunity to raise prices any amount they choose, as long as it’s slightly less than the tarrif, thereby making more money and enjoying the advantage of not paying the tariffs. People will still buy cars, and they might buy American cars because they’re now a little cheaper than non-US… But if they do this, the tariffs will pretty much only result in higher priced cars across the board instead of affordable IS cars vs expensive foreign ones.
Basically someone explained to Trump one of the many ways the tariffs will be backfiring, and he’s ineffectually asking companies not to do that.
I think a lot less people will be buying cars. And a lot of other stuff.
For sure it’s a two part thing, but regardless of the increased cost of US cars due to other tariffs, the price will still include the opportunistic gaming US car companies will play based on the car tarrif trump is stupidly rotting with.
Conceivably the only benefit the auto tarrif will do is allow US companies try to remain competitive against foreign companies who won’t have to deal with the materials tariffs he’s stupidly straddling US companies with.