Will Trump’s Tariffs Make Cars Unaffordable for Americans? We discuss in this weeks podcast with Paul Fix III (@paulfix3) and Lauren Fix discuss the facts and why not to panic.

President Donald Trump on Saturday imposed a 25% tariffs on most imports from Canada and Mexico and a 10% tariffs on Chinese goods, effective Tuesday. Energy products from Canada will be assessed a 10% tariff.

The U.S. automotive industry faces uncertainty as President Donald Trump prepares to impose 25% tariffs on vehicle imports from Canada and Mexico. The policy shift has taken effect, and this has left automakers in a state of anticipation, delaying key business decisions.

What are the facts on the impact to car prices? 

While some are screaming that car prices will increase by $10,000, they are incorrect in their assessment. Some car brands planned ahead such as BMW; Volvo; Hyundai, Toyota, Honda, and KIA. 

General Motors, the top U.S. automaker, and others have closely monitored the situation, seeking clarity to adjust production and pricing strategies. Tariffs would directly impact manufacturers that rely on North American trade, potentially increasing vehicle costs and reducing consumer demand. GM, Ford and Stellantis built vehicle in Canada and Mexico to lower labor rates and they will be forced to shift their manufacturing to the US to avoid the tariffs and increased costs. 

The auto industry is deeply interconnected across North America, with manufacturers depending on supply chains that span the U.S., Canada, and Mexico. In 2024, Mexico imported 49.4% of its auto parts from the U.S. while exporting 86.9% of its production back. This supply chain disruption could result in billions in additional costs for companies, affecting both vehicle prices and profit margins. 

If enacted, the tariffs could have a widespread impact on automakers with significant production in Mexico and Canada. Volkswagen,  Nissan, and Stellantis face the greatest risk due to their reliance on Mexican manufacturing, while GM, Ford, Honda, and Toyota would also be affected to varying degrees.

With nearly four million vehicles produced annually in Mexico for the U.S. market, the proposed tariffs could reshape the industry’s production strategies and force companies to reevaluate their North American operations.

The results will be manufacturers returning production to the USA. We will be watching as the pressure is put on Canada, Mexico, China and the EU.

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