Canadian Prime Minister Justin Trudeau said the new 25% tariffs imposed on his country by the Trump administration are “very stupid.” (Credit: Reuters)
president Donald Trump's New tariffs in Mexico and Canada could cause car prices to surge up to $12,000, according to a new analysis.
Anderson's Economic Group analyzed the impact of Trump's 25% tariff We found that customs duties, a tax on imports, are caused by Canadian and Mexican products.
For crossover utility vehicles, tariffs increase manufacturing costs at least $4,000, while for a large SUV with a ton of content from Mexico, it increases by about $9,000.
Electric vehicles (EVs) are seeing the biggest increase in costs from tariffs, as costs could rise over $12,000, the analysis found.
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President Donald Trump's 25% tariffs on imports from Canada and Mexico could increase the price of a car per vehicle by thousands of dollars, analysis found. (Anna Money Maker/Getty Images/Getty Images)
Anderson's economic group also considered the impact of potential additional steel and aluminum tariffs. This would be to add between $250 and $800 for gas-powered vehicles made in North America, and up to $2,500 in EVS, assuming the exclusion applies to national tariffs.
Vehicles made in Europe and Asia will add a cost of between $800 and $1,700 per vehicle, without tariff exclusion.
Retaliation Tariff That Canada and Mexico may be leviing more on US goods than Trump's 25% tariffs, can increase these prices as taxes are imposed or increased, spurring retaliation by the Trump administration.
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Canadian Prime Minister Justin Trudeau condemned the Trump administration's new tariffs on Tuesday, March 4th. (Thierry Monasse / Getty Images / Getty Images)
Patrick Anderson, CEO of Anderson Economic Group; I told Bloomberg“This type of cost increase directly leads to a decline in sales of the model, which has the biggest trade impact.”
North America Automotive Industry Automakers are very interconnected between their facilities in the US, Canada and Mexico as they build supply chains to take advantage of the efficiency created by three-party trade agreements.
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Mexican President Claudia Sinbaum will hold a press conference on March 4th to announce the response to US tariffs at the National Palace in Mexico City. (Raquel Cunha/Reuters/Reuters)
Automotive parts can be returned from the US to Canada, to Mexico and then to the US in the process of the manufacturing process. Some and some companies may cross the US more frequently.
Every time these auto parts cross the US border, if no exceptions are accepted, a 25% tariff can be assessed. This encourages the price consumers pay for the finished product or partially outweighs.
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Report of Kato Research Institute Please note that with some auto parts, such as engines and transmissions, that part may cross the borders of Canada and Mexico more than 7-8 times before entering the finished vehicle.
