Automakers Face Rising Costs, Signaling Potential Price Hikes for Consumers

President Trump's trade policies have not yet impacted new car prices. However, this situation is not expected to persist.

Analysts predict that by the end of the year, or potentially sooner, tariffs of up to 27.5 percent on vehicles and their components will lead to a substantial increase in sticker prices. This rise could make new vehicle purchases unaffordable for a significant portion of the American population.

Automakers have already experienced a reduction of billions of dollars in their profits due to the tariffs. To avoid losing sales, these companies have largely absorbed the financial burden of the new duties, rather than passing the costs onto consumers. Furthermore, the full impact of the tariffs has not yet been felt, as many dealers and manufacturers had stockpiled vehicles and parts before the tariffs were implemented.

"We haven’t raised prices due to tariffs, and that’s still our mantra," stated Randy Parker, the chief executive of Hyundai and Genesis Motor North America, in a recent interview.