Starting April 2, a 25% tariff will be levied on all automobiles manufactured outside the United States. President Donald Trump has implemented this measure to "safeguard the domestic automotive industry," calling it an economic "Liberation Day." This decision will have a direct impact on several popular brands and models assembled in Mexico that are favored by American consumers.
According to a Univision report, the six most imported cars that will be affected by this policy include:
- Chevrolet Equinox – 219,071 units imported
- Toyota Tacoma – 213,091 units
- Nissan Sentra – 179,767 units
- Honda HR-V – 166,156 units
- Ford Maverick – 165,337 units
- Ford Bronco Sport – 148,215 units
Mexico plays a critical role in the automotive sector for the U.S. market, with 80% of vehicles assembled there destined for American roads. Over 109,000 individuals work in vehicle assembly in Mexico, along with more than 664,000 in the auto parts industry.
Trump has stated firmly that there will be no exceptions to this policy, not even for allies such as Canada, Mexico, or European countries. The tariffs will also apply to auto parts, including engines and transmissions, effective by May 3, unless they meet the requirements set by the United States-Mexico-Canada Agreement (USMCA).
The U.S. government projects that these tariffs could generate up to $100 billion annually, which would be allocated towards infrastructure projects and reducing national debt. However, consumers are discontented, as not only will new cars become more expensive, but maintenance and essential part replacements will also see a price increase.
The stock prices of major automakers, including General Motors, Ford, and Stellantis, have already taken a hit, with GM losing over 7% and Ford and Stellantis falling more than 4%. This reflects the industry's anxiety over the potential repercussions of the tariffs.
Manufacturers and experts warn that relocating the entire production chain to the U.S. is not a feasible short-term solution, potentially leading to significant price hikes for consumers.
Understanding the Impact of New U.S. Auto Tariffs
Why are tariffs being imposed on foreign cars?
The tariffs are intended to protect the domestic automotive industry by making imported cars more expensive, thus encouraging consumers to buy vehicles manufactured in the United States.
Which cars are most impacted by the tariffs?
Some of the most affected cars include the Chevrolet Equinox, Toyota Tacoma, Nissan Sentra, Honda HR-V, Ford Maverick, and Ford Bronco Sport, all of which are assembled in Mexico.
How might these tariffs affect car prices in the U.S.?
The tariffs are likely to increase the prices of both new cars and maintenance due to higher costs of imported vehicles and parts.