A sign of the tariff era? Automakers are importing fewer cars under $30K, study says

USA Today

22-07-2025

Entry-level cars are harder to find thanks to tariffs.
The impact of tariffs on the auto industry is no longer theoretical. Auto tariffs are officially limiting the options available to American car buyers. Though the average new price of a car is nearly $49,000, several popular automakers have options in their portfolios closer to $30,000. Those options aren't as readily available as the pre-tariff era due to costs and profit margins.
Inventory of new vehicles priced under $30,000 has dropped significantly from 38% of the total market in 2019 to just 13.6% in the first half of 2025, according to Cars Commerce. Americans may want affordable entry-level cars, but automakers have limited the supply of these vehicles because of their exposure to tariffs.
Affordable new cars are a casualty of trade war
There are still plenty of affordable entry-level cars on the market but an inventory decline of over 24% in just a few years is concerning. Cars under $30K are primarily built outside of the U.S. (92%), says Cars Commerce. So, these vehicles are disproportionately affected by import and part tariffs. Since these vehicles are proving more expensive to import and build than vehicles with higher price tags, automakers have been limiting their entry-level car inventory.
The mid-range new car segment ranges from $30,000 to $49,000. It includes small and midsize SUVs and accounts for almost half of new car inventory. A whopping 50% of these mid-range new cars are imported, so vehicles priced above $30,000 are feeling the impact of tariffs as well.
On the bright side, there are two popular affordable car nameplates that are built in the U.S. The Honda Civic and Toyota Corolla are two of the best-selling small cars on the market. The Civic is built in Indiana and the majority of its parts come from North America. The Toyota Corolla is built in Mississippi and a large percentage of its parts come from North America. So, the trade war isn't entirely decimating the entry-level car segment.
How the auto industry is responding to tariffs
A coalition of U.S. auto industry groups sent a letter to the Trump administration following the announcement of 25% tariffs on imports and auto parts in March. The letter expressed concerns regarding the tariffs' impact on vehicle prices, vehicle sales, the American autos workforce, and the costs of servicing and repairing vehicles.
President Donald Trump signed an executive order and proclamation on April 29, to ease auto tariffs. That said, the actions have done little to brace automakers for the overall impact of tariffs based on the recent study by Cars Commerce.
Several automakers have shifted production strategies and adjusted pricing with some brands even lowering their prices to entice consumers. Ford launched its "From America, For America" campaign, a campaign that championed American-made automobiles and offered employee pricing to customers for over three months. The campaign resulted in a 14% gain in Ford Q2 sales. It even allowed the automaker to outsell Toyota for the first half of 2025 (by a narrow margin).
Ultimately, most major automakers are adjusting to auto tariffs with some companies like Ford making lemonade out of lemons. The impact of the trade war may be widespread, but there are still plenty of deals to be found for car buyers.
What cars are safe from tariff impact?
No vehicle is completely safe from some sort of tariff impact, but there are several brands and models better-positioned to weather the storm. Tesla vehicles are some of the most American-made cars on the market. Several other brands also produce nameplates that are primarily manufactured in America using mostly American-made parts.
Getting a used car is also a great way to avoid price fluctuations in the new car market. Used cars priced between $20,000-$30,000 "offer the best balance of affordability and condition" according to Cars Commerce.