Carmakers are likely to face higher costs regardless of how they respond to President Trump’s 25 percent tariffs on cars and auto parts.
Automakers can respond to President Trump’s new 25 percent tariffs on imported cars and parts in several ways. But all of them cost money and will lead to higher car prices, analysts say.
Manufacturers can try to move production from countries like Mexico to the United States. They can try to increase the number of cars they already make here. They can stop selling imported models, especially ones that are less profitable.
But whatever carmakers decide, car buyers can expect to pay more for new and used vehicles. Estimates vary widely and depend on the model, but the increase could range from around $3,000 for a car made in the United States to well over $10,000 for imported models.
Those figures do not take into account additional tariffs that Mr. Trump said he would announce next week to punish countries that impose tariffs on U.S. goods. He has also said he would increase tariffs further if trading partners like Canada and the European Union raise tariffs in response to his auto tariffs, leading to an escalating tit-for-tat trade war.
“It’s going to be disruptive and expensive for American consumers for several years,” said Michael Cusumano, professor of management at the MIT Sloan School of Management.
Mr. Trump has long brandished tariffs. But many auto executives had hoped that his threats were a negotiating tool. Mr. Trump dashed those hopes on Wednesday when he said at the White House that the tariffs were “100 percent” permanent.
Where Popular Cars (and Their Parts) Come From
Here is a selection of well-known models and where their components come from, as well as where the vehicle is ultimately assembled.