Luxury European carmakers warn that higher prices are coming if Trump doesn't back off tariffs
Trump's tariffs are battering the car industry, and buyers of luxury European motors are about to feel the pain.
European luxury brands Porsche and Volvo issued new tariff warnings on Tuesday as they reported collapsing profits, with Porsche's CFO saying the company would "definitely" hike prices if the Trump administration did not back down.
"If negotiations do not turn out to be successful, and the tariff regime stays as we see it today, we will definitely increase prices in the US," said Porsche's CFO, Jochen Breckner, in an earnings call.
The German luxury brand, which said it has not yet adjusted prices in the US, is more exposed to the tariffs than many of its rivals, as it imports all the cars that it sells in the country.
Porsche cut its return on sales guidance for the second time in two months on Tuesday and said that profits had collapsed 40% in the first quarter.
The company has seen sales fall in Europe and China, but said that US deliveries had risen 42% in the first three months of the year.
Swedish rival Volvo Cars, which sells the $80,000 EX90 among other models in the US, also signalled that it would look to pass some of the cost of the tariffs onto consumers.
"For the US, we are taking commercial measures linked to pricing and what cars we sell," Volvo CFO Fredrik Hansson told analysts in an earnings call on Tuesday, adding that the company continued to monitor the market on "basically a daily basis."
Volvo Cars reported a 59% drop in operating profit in the first quarter of 2025 and withheld guidance for this year and 2026, and Hansson warned that "commercial measures" would likely not be enough to steady the ship.
The company said it would enact a $1.9 billion cost-cutting plan that would involve an unspecified number of layoffs. Volvo's shares were down over 9% on Tuesday, while Porsche's also slumped 6%.
The warnings from European firms come as the Trump administration hinted that tariff relief could be imminent for automakers.
A White House spokesperson told multiple outlets that while the 25% tariffs on imported vehicles would remain in place, automakers would be exempted from additional tariffs, such as those on imported steel and aluminum, and would be reimbursed for some of the cost of tariffs on imported car parts.
The coming U-turn will come as a relief for carmakers like Ford and GM, which faced having their profits wiped out as a result of the levies, but it is unlikely to prevent carmakers from hiking their prices as they look to absorb the cost of the tariffs.
Automakers and analysts have warned that the 25% import tax will lead to major price hikes. Anderson Economic Group previously estimated that new car prices will rise between $4,000 and $12,000, depending on the vehicle.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
New York Post
6 minutes ago
- New York Post
Musk's father says Elon made a mistake going nuclear on Trump, predicts prez ‘will prevail'
Tech mogul Elon Musk's father lamented his son's scorched-earth war of words with President Trump as a 'mistake' and warned that the US leader would ultimately prevail in the nasty spat. Errol Musk, who has had a strained relationship with his billionaire son, explained that Elon had been under tremendous stress and was optimistic the two personality giants could patch things up. 'They've been under a lot of stress for five months. And it gives them a break. You know, they've had to get rid of all the opposition, try and put the country back on track, and do normal things and so forth,' Errol told Russian media, per Izvestia. 'They're very tired and stressed. And so you can expect something like this. It's not unusual,' the elder Musk added. 'Trump will prevail. He's the president. He was elected as the president, so Elon made a mistake, I think. But he's tired. He's stressed.' Elon had slowly begun to split with Trump and Republicans publicly last month over the One Big Beautiful Bill Act due to his concerns about its impact on the deficit. 4 Errol Musk seemed optimistic that President Trump and Elon Musk could reconcile. 4 Elon Musk's time as a special government employee ended last month. AFP via Getty Images It started with some swipes during an interview on CBS's 'Sunday Morning Show.' Then, Musk ramped up his attacks on the marquee GOP megabill, ripping it as 'pork-filled' and a 'disgusting abomination.' Finally, last Thursday, Musk went nuclear on Trump. The world's richest man argued that without his help, 'Trump would have lost the election, Dems would control the House and the Republicans would be 51-49 in the Senate.' At one point, Musk appeared to back impeachment against Trump and then dropped a 'big bomb,' claiming that the president was in the Epstein files, in a since-deleted post. During the epic public feud, Trump threatened to sever lucrative federal contracts with Musk's companies and the tech baron suggested he'd decommission the Dragon spacecraft, the government's main method of getting into orbit, before reversing course. 4 Elon Musk and President Trump had forged a public alliance to trim government waste and bloat. AP Musk's time as a special government employee wrapped up late last month, and Trump gave him a chummy send-off in the Oval Office. Musk had seemingly also grown incensed after the president withdrew his nomination of Jared Isaacman to helm NASA. 'Elon wants to stick to the principles of not giving in to the Democrats [and] their stupid ideas,' Errol added. 'It's normal, it's just a small thing, [it] will be over tomorrow.' Errol was in Moscow to address the Future Forum 2050, an event to promote Russia's development championed by diehard nationalist Alexander Dugin, who is known as 'Vladimir Putin's philosopher.' Trump has publicly downplayed the breakup with Musk, but warned the billionaire that there will be 'consequences' if he starts dipping into his deep pockets to help Democrats in the 2026 midterm elections. Elon has expressed openness to working to patch things up with the president and Vice President JD Vance had been optimistic they could bring the tech baron back into the fold. 'No, I don't have any plans,' Trump replied when asked by reporters if he had plans to reconcile with Musk, adding that he's 'not really interested' in such efforts. 'I'm not thinking about Elon. You know, I just wish him well.' 4 Elon Musk went berserk on President Trump last week as tensions boiled over. The president suggested that Musk had 'lost his mind' and gone 'crazy.' Privately, Trump bashed Musk as a 'big-time drug addict,' according to the Washington Post. Musk denies being addicted to drugs. Errol, who has a frosty relationship with his son, has long been a backer of Trump. The South African engineer had briefly been a politician, serving on the Pretoria City Council as an Independent and then later a member of the Progressive Federal Party, which opposed apartheid.
The Hill
25 minutes ago
- The Hill
Trump's palace coup leaves NASA in limbo
When President-elect Donald Trump nominated Jared Isaacman to become NASA administrator, it seemed like a brilliant choice. Business entrepreneur, private astronaut, Isaacman was just the man to revamp NASA and make it into a catalyst for taking humanity to the moon, Mars and beyond. Isaacman sailed through the confirmation process in the Senate Commerce Committee, chaired by Sen. Ted Cruz (R-Texas), by a vote of 19 to 9. He was poised to be confirmed by the full Senate when something so bizarre happened that it beggars the imagination. The White House suddenly and with no clear reason why, pulled Isaacman's nomination. After months of a confirmation process, NASA was back to square one for getting a new leader. Ars Technica's Eric Berger offered an explanation as to why. 'One mark against Isaacman is that he had recently donated money to Democrats,' he wrote. 'He also indicated opposition to some of the White House's proposed cuts to NASA's science budget.' But these facts were well known even before Trump nominated Isaacman. Trump himself, before he ran for president as a Republican, donated to Democrats and was close friends with Bill and Hillary Clinton. Berger goes on to say that a source told the publication that, 'with Musk's exit, his opponents within the administration sought to punish him by killing Isaacman's nomination.' The idea that Isaacman's nomination is being deep-sixed because of Musk runs contrary to the public praise that the president has given the billionaire rocket and electric car entrepreneur. Trump was uncharacteristically terse in his own social media post. 'After a thorough review of prior associations, I am hereby withdrawing the nomination of Jared Isaacman to head NASA,' he wrote. 'I will soon announce a new nominee who will be mission aligned, and put America First in Space. Thank you for your attention to this matter!' CNN reports that Isaacman's ouster was the result of a palace coup, noting that a source said, 'Musk's exit left room for a faction of people in Trump's inner circle, particularly Sergio Gor, the longtime Trump supporter and director of the White House Presidential Personnel Office, to advocate for installing a different nominee.' The motive seems to be discontent about the outsized influence that Musk has had on the White House and a desire to take him down a peg or two. Isaacman was profoundly gracious, stating in part, 'I am incredibly grateful to President Trump @POTUS, the Senate and all those who supported me throughout this journey. The past six months have been enlightening and, honestly, a bit thrilling. I have gained a much deeper appreciation for the complexities of government and the weight our political leaders carry.' The idea that a man like Isaacman, well respected by the aerospace community, who was predicted to sail through a confirmation vote in the full Senate, could be taken down by an obscure bureaucrat in White House intrigue, motivated by petty spite, is mind boggling. Even Sen. Mark Kelly (D-Ariz.), who has not been fond of Trump's space policy, was appalled. He posted on his X account that Isaacman 'ran into the kind of politics that is damaging our country.' 'Republicans and Democrats supported him as the right guy at the right time for the top job at NASA, but it wasn't enough.' NASA is in for months more of turmoil and uncertainty as the nomination process gets reset and starts grinding its way through the Senate. The draconian, truncated budget proposal is certainly not helpful, either. Congress, which had been supportive of Trump's space policy, is not likely to be pleased by the president's high-handed shivving of his own nominee. Whoever Trump chooses to replace Isaacman as NASA administrator nominee, no matter how qualified, should face some very direct questioning. Trump's NASA budget proposal should be dead on arrival, which, considering the cuts in science and technology, is not necessarily a bad thing. China must be looking at the spectacle of NASA being mired in political wrangling, a leadership vacuum and budget uncertainty with glee. Beijing has its own space ambitions, with a planned crewed lunar landing by 2030. It's possible that the Chinese will steal a march on NASA, with all the damage that will do to America's standing in the world. It didn't have to be this way. Isaacman could be settling in as NASA administrator, deploying his business acumen and vision to lead the space agency to its greatest achievements. Instead, America's space effort has received a self-inflicted blow from which it will be long in recovering, Mark R. Whittington, who writes frequently about space policy, has published a political study of space exploration entitled 'Why is It So Hard to Go Back to the Moon?' as well as 'The Moon, Mars and Beyond,' and, most recently, 'Why is America Going Back to the Moon?' He blogs at Curmudgeons Corner.
Politico
30 minutes ago
- Politico
American presidents have long used autopens. Just ask Trump.
Donald Trump has repeatedly slammed Joe Biden's use of an autopen during his presidency, going so far as to center its usage in a broad investigation Trump announced Wednesday into his predecessor. But politicians on both sides of the aisle are deeply familiar with the tool. The autopen — also referred to as the robot pen — replicates an individual's signature using a writing utensil, rather than a scanned and printed version of it. The tool, which resembles a small printer with a long arm that allows users to attach a pen to the center, has a long history of use in American politics. The device was first patented in 1803, according to the Shapell Manuscript Foundation, an independent research organization that collects original manuscripts and historical documents. Iterations of the autopen have been used by presidents as far back as Thomas Jefferson, who wrote that 'I could not, now therefore, live without' the device he used to duplicate letters. 'The Autopen has long been a tool for the world's most influential leaders, allowing them to more effectively apply their time and attention to important issues without compromising the impact of personalized correspondence,' according to The Autopen Co., which sells the machines. U.S. leaders on both sides of the aisle have used the autopen for decades — and have faced criticism for their use of the tool. During Lyndon Johnson's administration, the autopen was featured in The National Enquirer for an article headlined 'One of the Best Kept Secrets in Washington: The Robot That Sits In For The President.' Even Trump himself has said he used autopens, but 'only for very unimportant papers.' 'We may use it, as an example, to send some young person a letter because it's nice,' Trump said in March, according to The Associated Press. 'You know, we get thousands and thousands of letters, letters of support for young people, from people that aren't feeling well, etcetera. But to sign pardons and all of the things that he signed with an autopen is disgraceful.' In 2004, George W. Bush's secretary of Defense, Donald Rumsfeld, faced criticism from some veterans for using an autopen to sign condolence letters to families of troops killed in the Iraq War. In 2011, Barack Obama used an autopen to sign a Patriot Act extension — becoming the first known, apparent use of the tool by a president for legislation — and used it subsequently in his administration. The move resulted in Republicans questioning the constitutionality of Obama's decision, though Bush's Office of Legal Counsel, which is part of the Department of Justice, had already concluded the use of autopens was constitutional. 'The President need not personally perform the physical act of affixing his signature to a bill he approves and decides to sign in order for the bill to become law,' the office's 2005 ruling stated. 'Rather, the President may sign a bill within the meaning of Article I, Section 7 by directing a subordinate to affix the President's signature to such a bill, for example by autopen.' There is no specific law governing a president's use of an autopen. But the ruling from the Department of Justice hasn't stopped Trump from accusing Biden and his team of illegally using the tool, alleging that Biden's team used an autopen to sign documents without Biden's permission or knowledge. Trump has also claimed that Biden's round of pardons — including 'preemptive pardons' of Jan. 6 investigators, his son Hunter Biden and Anthony Fauci — were illegal and are 'void' and 'vacant.' However, most legal scholars are in agreement that pardons cannot be overturned once granted. In 1869, a federal court ruled, 'The law undoubtedly is, that when a pardon is complete, there is no power to revoke it, any more than there is power to revoke any other completed act.' Biden has denied the claims that any decision was ever made or issued in his name without his approval or knowledge. Trump and other Republican accusers have provided no evidence that aides used an autopen without the former president's approval. 'Let me be clear: I made the decisions during my presidency,' Biden told POLITICO in a statement. 'I made the decisions about the pardons, executive orders, legislation, and proclamations. Any suggestion that I didn't is ridiculous and false. This is nothing more than a distraction by Donald Trump and Congressional Republicans who are working to push disastrous legislation that would cut essential programs like Medicaid and raise costs on American families, all to pay for tax breaks for the ultra-wealthy and big corporations.'
