How Trump’s Canada and Mexico tariffs risk higher prices on cars

At least some of those costs will be paid to consumers, he said, as automakers are already operating on a relatively thin margin. The car’s price record is high, Increase 34% One from 2019 Average sales price About, 000 50,000. If the supply of an old car goes down, the price of the car may also rise as the prices encourage the prices. More Americans Stop upgrading their vehicle.

Vehicles and their parts between Canada, the US and Mexico have been freely flowing as the automotive supply chain has become knitted. US The car built in consists of parts of Canada and Mexico, while our parts are used around the border and later in assembled cars Sent back to sell American customers.

“Parts travel very freely, and they are only part of the vehicle’s assembly process,” said Sam Fiorani, auto toe industry analyzer of Toporecast Solutions. “A supplier in NT Natario can provide parts of a factory in Michigan or Ohio and .Last. How has the business plan developed in the last half century or more.”

Commerce Secretary Howard Lootnik disputed the imagination that in an interview on Tuesday on CNBC, tariffs would lead to a price for customers.

“Tariffs don’t inflate,” Lootnik said. “A product can be more expensive and a product can be less expensive. China has the highest tariffs in the world. Taxes are imposed on everything in China, and they do not have inflation. In fact, they have deflation. India has second in the world, they have no inflation. So this concept is just crying and complaining and not truthful. The fact is that we need to protect America. “

Trump said they were putting tariffs in place, forcing countries to prevent undocumented immigrants and fantanil from entering US By their borders. More than 107,000 people According to the Drug Enforcement Administration, the drug overdose died in 2023, About 70% of those deaths from iO pioids, including Fantanil. Almost all 21,900 £ 21,900 of the captured in 2024 were on the south border, according to customs and border protection data, only £ 43 fantanil was seized on the northern border.

Even though Trump has also said that tariff companies have been used by Canada and Mexico from the US at a post on social media on Tuesday. Will encourage to move the product in, Trump wrote, “If companies go to the United States, there is no tariff !!!”

More vehicle production Moving in can take years and can come with costs for labor, materials and healthcare – it can contribute to all factors that prices for car buyers.

“Many of them have sought to move production in Mexico, one of the reasons is that labor costs are very affordable, environmental costs are not high, but also an issue,” said Aaron Bragman of Cars.com’s Detroit Bureau, “Cares. “It’s not a cheapest thing for this Auto Tomakers and at the end of the day it goes back to the customer, it all goes up the price.”

For Auto Tomakers, costs from tariffs can eventually lead to prices for prices, which can cause customers to stop buying. It will, in turn, reduce the production of new cars and eventually reduce the job, Bragman Said.

Bragmen said, “If people stop buying a car because they are too expensive, or they begin to delay this purchase because they are very expensive which means cutting production, which means they do not need many people working in plants.” “And it has a knock-on effect. If you begin to see plants not employing plants, local communities also begin to affect. “

United Auto toe Workers, who have long been opposed to a long free-trade deal with Canada and Mexico, said in a statement on Tuesday that he supported Trump The latest action on tariffs, called “powerful tool in the toolbox to undo the injustice of the anti-worker trade deal.” (Union before Trump’s Tariff Plans criticize Earlier their administration.)

“An American president is delighted to see an American president taking aggressive action on ending a decreased free trade disaster like a bomb on the working class.” “There has been a lot of talk of disturbing this tariff economy. But if the corporate America likes to gauge or attack an American worker at a price of American consumer because they do not want to pay their fair stake, Corporate America is blaming that decision. “

Nevertheless, the Auto Tomakers are warning that tariffs can eventually anchor their supply chain. Ford CEO Jim Farley warned last month that the threat of tariffs was causing anarchy in the auto industry and could have devastating consequences for American automakers.

“Let’s be a 25% tariff in the real honest, long -term, Mexico and Canadian border, a hole in the US industry that we have never seen,” Furle said at an investor conference last month.

Livonia, Michigan, Alphausa, who make more than 200 million automotive parts a year for US automakers, are tired of costing costs wrapping tariffs throughout its supply chain.

When the company parts are made in Michigan, it comes from some components of the parts, such as steel or wire, Canada. The company also carries at the assembly plant in Canada and Mexico and buys some of its equipment from Canada. It has already been notified by some suppliers that their prices will increase as a result of tariffs.

“I can’t imagine the tsunami that they will move on with this cost,” said Alphausa President Chak Dardas. “He will come to us, then we will deal with it. These suppliers that we have, unfortunately, if we do not ask them, they will stop sending us, and the last thing we are going to do is down to our customers. “

Auto toe parts and vehicles can also increase the cost of auto insurance if insurers have to pay more for repair parts and replacement vehicles, even at the price of the prices and vehicles. Analysis By S&P Global. Progressive CEO Trisea Griffith said at a conference on Tuesday, “The insurer closely follows how the insurer would affect tariff prices and will prepare for the costs of costs.”