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A trade group representing the largest automotive companies has warned that the 25% tariffs on car imports from Canada and Mexico imposed by US President Donald Trump will lead to a sharp rise in prices on the market. Reuters reports this with reference to statements by representatives of the automotive industry.
“These tariffs on imports from Canada and Mexico will affect all automakers. Prices for some car models are expected to rise by as much as 25%, and the negative impact will be felt almost immediately,” said John Bozzella, chairman of the Alliance for Automotive Innovation. The Alliance represents automakers such as General Motors, Ford, Toyota, Volkswagen, Hyundai and Stellantis. Tesla remains an exception among the leading manufacturers.
Automakers say the new duties threaten North America’s integrated supply chain, which has been in place for more than 25 years. The production process means that car parts can cross the border six or more times before the final assembly of a car. This was also emphasised by Ford CEO Jim Farley, who said that the new tariffs would “blow a hole” in the US automotive industry.
Dealers in a difficult situation
The American International Automobile Dealers Association also said that the market is already feeling the pinch due to rising prices for cars and car parts, as well as high interest rates.
Stellantis on Tuesday informed its dealers that it continues to work with the Trump administration to mitigate the impact of the tariffs. The company said in a statement that “as the industry is highly integrated in North America, these tariffs will put brands like Chrysler, Dodge, Jeep and Ram at a competitive disadvantage compared to Korean, Japanese and European importers.”
Last week, representatives of leading automotive companies met with US Secretary of Commerce Howard Luthnick, urging the administration to abandon the large-scale tariff increase.
