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Yahoo
7 days ago
- Automotive
- Yahoo
Auto tariff price hikes: When is the best time to buy a car?
According to an analysis from the Anderson Economic Group, auto and auto-part tariffs could add at least $2,000 to the price of vehicles. However, many automakers are absorbing costs or raising prices modestly. Kelley Blue Book executive editor Brian Moody joins Wealth to explain that buyers already in the market should act soon, as used car prices are set to rise with shrinking inventory. To watch more expert insights and analysis on the latest market action, check out more Wealth here. 25% tariffs on imported cars and car parts are expected to create cost burdens of at least $2,000 per vehicle, according to an analysis from the Anderson Economic Group. And that estimate pushes upwards of $15,000 for certain electric vehicles and European and Asian luxury cars. Car companies are responding in kind. Hyundai, weighing 1% price increases across the board, according to Bloomberg. And starting July 5th, Ford will start raising prices on three Mexico-built models. Here with more, we've got Brian Moody, executive editor over at Kelly Blue Book. Great to have you here with us, Brian. Are we seeing some automakers mull price increases due to the tariff environment and how much do you expect will actually be passed on to the consumer? Well, it might vary model by model, but what we're seeing right now is that there hasn't really been much of a price increase on new cars. In fact, year-over-year, it's about flat, less than 1% of an increase on new cars. That's the average transaction price. But that's because certain automakers have chosen to sort of, you know, absorb that increase, while other automakers, Nissan specifically, have actually lowered the prices on specific models that are built here in the US. So some prices will go up, the ones that would be the most greatly impacted would be a car that arrives here to the US, almost already completely built. That's the car that's going to incur the largest tariff. And so, which companies are best navigating and best positioned, I guess, going forward to also navigate that tariff risk as it relates to the consumer price? Well, Hyundai Group is one that's positioned well, even though they are considering a 1% price increase across the board. But they do have a relatively new plant in Savannah, Georgia, which is positioned to build cars and SUVs for all of their brands, and that could be a wise move. Now, that was already in play long before the current crisis or the current administration. So that could have ended up being a wise move. Kia is also in a good position. Mercedes-Benz has actually said that they have their plant in Alabama, where they're going to ramp up production of models that maybe they did make outside the US, and they're going to build them here in the US. And those companies that can do that, that have the option of doing that, are going to be in the best position. Also, Ford builds a very large majority of their cars here in the US. So when is the best time to buy a car in this current environment right now? Well, if you're already in the market for a new car, and when I say that, I mean, don't let headlines move you into the new car market. Let's say you're already there, your lease is ending, you've had a wrecked car or your car just won't last any longer. Make that process speed up just a little bit. Don't jump in because you're afraid about what the prices are going to be if you have a good car now, but if you're already in the market, speeding that process up will help. I just don't see how waiting can help in any way, especially since we know used car prices were already going to go up, no matter what. And so, what is the outlook for the summer that you're anticipating? Um, gradually increasing used car prices, gradually shrinking used car inventory, a relatively healthy new car inventory, but prices, prices will gradually creep up on many cars that you typically thought of as low price. So what we don't know is how they're going to spread out the price increases. What we do know is that there probably will be increases. While we have you, Brian, we're also keeping tabs on the Republican tax bill that passed the House headed to the Senate. In the bill, there is a proposal for a tax break for car purchases. Americans would be able to deduct up to $10,000 a year in eligible auto loan interest. So how impactful could this be for buyers and what are some of the details from the best assessment that you've been able to kind of put together? Right. So that could be a very good thing for consumers. And here's why. The affordability of new cars has been decreasing, meaning they're just becoming more expensive, not just the price of the car, but the price of purchasing credit to buy that car, and the price of servicing and the price of parts. So that kind of relief could move more people into the market. You should still be reasonable and get a low-priced car based on your budget, but that kind of thing is the sort of hidden fee that many consumers don't like, the interest rate or the service plan. So it could help greatly. Another place to look for consumers is the used electric car market. That's a great place for some bargains. What are you making right now of just the sentiment among car brands, especially as we think about the EV landscape and how Tesla has been losing some of its, its luster internationally? Is that something that's also transpiring here domestically? Yes. Well, yes, but this past month, GM, Nissan, and Tesla had pretty good months because there was increases in their electric vehicles. And remember, Tesla only sells electric vehicles. But yes, Tesla market share will continue to go down and that's simply because there's more options. Think about when Tesla first introduced the Model S and the Model X, you know, years ago, there wasn't much competition. Today, there's plenty of competition from brands like Nissan, Ford, Honda, and others. Brian, great to see you. Thanks so much for taking the time here with us today. Thank you.
Yahoo
18-05-2025
- Automotive
- Yahoo
This Car Price Index Jumped to Its Highest Level Since 2023: Are Higher Car Prices Next?
The past few months have been hard on those looking for a new — and used — ride. Used car prices raced up by 4.9% year-over-year for the month of April 2025, according to Cox Automotive's Manheim Used Vehicle Value Index. That was after being up by 2.7% from March 2025, the previous month. Be Aware: Find Out: It's the highest jump in used car prices since 2023. Analysts think that might foretell rising car costs — both new and used — throughout the year. By now, it's common knowledge that tariffs work like a tax on the American importer, and are often passed down in part or in their entirety to the consumer. And since cars are expensive items, the impact can be sticker shocking. And although following the tariff roller coaster is anything but simple, on Apr. 3, following the expiration of U.S. exemptions under the U.S.-Mexico-Canada Agreement (USMCA), a 25% tariff was imposed on all imported cars. That disrupted the auto supply chain and automakers warned that the costs of the tariffs would be passed onto customers. That resulted in a lot of talk of higher car prices. For instance, a May 1 report by Anderson Economic Group estimated that new auto prices could jump anywhere from $2,500 to $15,000, depending on the make and model. All that sent many buyers to dealer lots to buy cars brought in before tariffs took effect. Read More: As new car prices rise, analysts say that more buyers may turn to the used car market, driving prices up there, too — hence, the March and April jumps in prices. And while used car prices have been less affected by tariffs than new car price projections, according to Carvana CEO Earnie Garcia, they are not immune. And in fact, Cox reported that the average used car retail listing price was up 2% in four weeks, to over $25,000. In the same time frame average new car prices hit $48,000. Not surprisingly, the tariff landscape changed recently — again — for the auto industry. According to Reuters, after the auto industry cried foul and pleaded with the Trump Administration, on Apr. 29, yet another executive order gave American automakers credits of up to 15% of the value of U.S.-assembled cars and trucks. That helps offset the price of the tariffs, but not eliminate it. That and other exemptions and allowances were designed to mitigate the damage of the tariffs and the cost to consumers. Still, the cost to automakers, and car buyers, remains significant. With a seemingly ever-changing trade policy and tariff landscape, uncertainty is high. That usually doesn't bode well for the consumer. So, according to Kelley Blue Book, even with the uncertainty, analysts expect new and used car prices to remain high or increase in 2025. More From GOBankingRates What $1 Million in Retirement Savings Looks Like in Monthly Spending 5 Types of Vehicles Retirees Should Stay Away From Buying 5 Little-Known Ways to Make Summer Travel More Affordable 7 Tax Loopholes the Rich Use To Pay Less and Build More Wealth Sources Manheim, 'Used Vehicle Value Index.' Anderson Economic Group, 'Tariff Costs for U.S.-Assembled Vehicles Drop Under 'Adjusted' Policy.' Investor's Business Daily, 'Used-Car Prices Jump On Tariffs, Lifting Carvana, These Other Auto-Retail Stocks.' CNBC, 'Used vehicle pricing barometer jumps to highest level since 2023 amid auto tariffs.' Reuters, 'Trump set to soften auto tariffs after industry pushback.' Kelley Blue Book, 'When Will New Car Prices Drop?' This article originally appeared on This Car Price Index Jumped to Its Highest Level Since 2023: Are Higher Car Prices Next? Sign in to access your portfolio
Yahoo
06-05-2025
- Automotive
- Yahoo
Economists estimate new tariff costs to range between $2,000 to $12,000 per vehicle
A Michigan economics group, calculating tariff impact after President Donald Trump's latest executive orders, has estimated that the least-impacted vehicles will still face a $2,000 tariff and the most impacted will see a tariff of $15,000. Anderson Economic Group started analyzing the costs of tariffs imposed on a variety of vehicles sold in the United States as soon as Trump signed his latest executive orders on auto tariffs, Patrick Anderson, CEO of the consulting firm, told the Detroit Free Press. The firm's new estimates include the changes Trump made on April 29 intended to provide some relief to automakers who assemble vehicles in the United States but use foreign parts in them. The order provides a small break on tariffs for two years to allow automakers time to re-source parts from domestic suppliers. File photo taken on June 8, 2017. Employees inspect Mercedes-Benz C-Class cars at the Mercedes-Benz US International factory in Vance, Alabama. "The adjustments provide significant and beneficial softening of the cost impact of these tariffs, at least for U.S.-assembled vehicles," said Anderson, who is the lead author of this study. "However, the cost is still substantial for most American cars and trucks.' Some vehicles will see a $15,000 hit Anderson noted that many U.S. consumers have been taking no chances, saying, 'The sales surge in March confirms that Americans expect prices to go up because of tariffs, and the revised (Anderson Economic Group) estimates confirm they are right." Anderson Economic Group estimated the tariff costs under the adjusted policy as follows: ◾Lower impact: These are vehicles assembled in the United States with substantial U.S. parts content. The estimated tariff costs will be $2,000 to $3,000 per vehicle. Examples: Honda Civic, Honda Odyssey, Chevrolet Malibu, Toyota Camry Hybrid and Ford Explorer. ◾Medium impact: Vehicles in this group will pay a tariff of $4,000 to $8,000. Some Jeep and Ram truck models are in this category, as are the Chrysler Pacifica van, BMW X3, Ford Bronco Sport and Volkswagen Jetta. Some vehicles assembled in Texas, such as the Chevrolet Suburban and GMC Yukon large SUVs, will see a tariff of just under $8,000, a reduction from the previous estimate of $11,000 in tariffs before Trump adjusted the tariffs. ◾High impact: These are mostly full-size luxury SUVs, some all-electric vehicles and cars assembled in Europe and Asia. The tariff impact on these vehicles will be $10,000 to $12,000, with some EVs and European and Asian luxury vehicles having an estimated tariff exceeding $15,000. Mercedes G-Wagon, other Mercedes sedans, Land Rover and Range Rover vehicles, some BMW models and the Ford Mach-E, fall into this group.
USA Today
05-05-2025
- Automotive
- USA Today
Economists estimate new tariff costs to range between $2,000 to $12,000 per vehicle
Economists estimate new tariff costs to range between $2,000 to $12,000 per vehicle Show Caption Hide Caption Gov. Gretchen Whitmer agrees with Donald Trump on manufacturing, not widespread tariffs Michigan's Governor Gretchen Whitmer delivered a speech in Washington, D.C. for 'Build, America, Build." Anderson Economic Group has estimated that Trump's revised tariffs on parts still results in tariffs of $2,000 to possibly $15,000 per vehicle. The Ford Mach-E still falls into a high tariff group because it is built in Mexico. A Michigan economics group, calculating tariff impact after President Donald Trump's latest executive orders, has estimated that the least-impacted vehicles will still face a $2,000 tariff and the most impacted will see a tariff of $15,000. Anderson Economic Group started analyzing the costs of tariffs imposed on a variety of vehicles sold in the United States as soon as Trump signed his latest executive orders on auto tariffs, Patrick Anderson, CEO of the consulting firm, told the Detroit Free Press. The firm's new estimates include the changes Trump made on April 29 intended to provide some relief to automakers who assemble vehicles in the United States but use foreign parts in them. The order provides a small break on tariffs for two years to allow automakers time to re-source parts from domestic suppliers. "The adjustments provide significant and beneficial softening of the cost impact of these tariffs, at least for US-assembled vehicles," said Anderson, who is the lead author of this study. "However, the cost is still substantial for most American cars and trucks.' Some vehicles will see a $15,000 hit Anderson noted that many U.S. consumers have been taking no chances saying, 'The sales surge in March confirms that Americans expect prices to go up because of tariffs, and the revised (Anderson Economic Group) estimates confirm they are right." Anderson Economic Group estimated the tariff costs under the adjusted policy as follows: Lower impact : These are vehicles assembled in the United States with substantial U.S. parts content. The estimated tariff costs will be $2,000 to $3,000 per vehicle. Examples: Honda Civic, Honda Odyssey, Chevrolet Malibu, Toyota Camry Hybrid and Ford Explorer. : These are vehicles assembled in the United States with substantial U.S. parts content. The estimated tariff costs will be $2,000 to $3,000 per vehicle. Examples: Honda Civic, Honda Odyssey, Chevrolet Malibu, Toyota Camry Hybrid and Ford Explorer. Medium impact : Vehicles in this group will pay a tariff of $4,000 to $8,000. Some Jeep and Ram truck models are in this category, as are the Chrysler Pacifica van, BMW X3, Ford Bronco Sport and Volkswagen Jetta. Some vehicles assembled in Texas, such as the Chevrolet Suburban and GMC Yukon large SUVs, will see a tariff of just under $8,000, a reduction from the previous estimate of $11,000 in tariffs before Trump adjusted the tariffs. : Vehicles in this group will pay a tariff of $4,000 to $8,000. Some Jeep and Ram truck models are in this category, as are the Chrysler Pacifica van, BMW X3, Ford Bronco Sport and Volkswagen Jetta. Some vehicles assembled in Texas, such as the Chevrolet Suburban and GMC Yukon large SUVs, will see a tariff of just under $8,000, a reduction from the previous estimate of $11,000 in tariffs before Trump adjusted the tariffs. High impact: These are mostly full-size luxury SUVs, some all-electric vehicles and cars assembled in Europe and Asia. The tariff impact on these vehicles will be $10,000 to $12,000, with some EVs and European and Asian luxury vehicles having an estimated tariff exceeding $15,000. Mercedes G-Wagon, other Mercedes sedans, Land Rover and Range Rover vehicles, some BMW models and the Ford Mach-E, fall into this group. Anderson said that because the list prices and content on specific vehicles within model lines vary considerably, so will the tariff impact. General Motors, however, disagreed with some of Anderson's findings. GM spokesman Jim Cain said, 'The calculation on the large SUVs overstates GM's tariff exposure on those vehicles. It is almost guesswork.' Class action lawsuits: Automaker GM knew about V8 engine problems for years before giant, lawsuit claims Cain declined to provide the exact dollar exposure the large SUVs may have to tariffs, saying that is proprietary information. Anderson said he stood by the calculation, citing GM's filings with the U.S. government as the source for how much U.S. content GM has in those vehicles, hence its tariff exposure. Trump's tariff tweak helps only a little On April 3, Trump put a 25% tariff — the tax an importer pays on a good when it crosses international borders — on all imported vehicles to encourage more U.S. manufacturing. Trump was set to then enact 25% tariffs on all imported parts starting May 3. But given that most vehicles assembled in the United States contain a lot of imported parts, the duties on those parts would run into thousands of dollars per vehicle. So on April 29, the administration modified its 25% tariffs on foreign auto parts. In a complex formula, the executive orders Trump signed will now allow automakers to be reimbursed for those tariffs up to an amount equal to 3.75% of the value of a U.S.-made car for one year. The reimbursement drops to 2.5% of the car's value in a second year, and then is phased out. "The April 29 proclamation reduces tariff costs for some vehicles assembled in the United States, butdoes not eliminate tariff costs from any vehicle we studied," Anderson said in the study's news release. "For vehicles assembled in other countries, including those assembled using substantial U.S. content, the new policy does not significantly reduce the cost of the automotive tariffs." For example, the all-electric Ford Mach-E is assembled in Mexico and has a list price of about $55,000. Anderson said before the April 29 executive order, it had a tariff exceeding $12,000. He said it will still have that high tariff. But the Ford Explorer, which Ford assembles in Illinois and has a list price of about $50,000, previously had a tariff impact of about $4,300. That will drop to about $2,400, under the new rules. For specifics on the study and Anderson's methodology visit its website at Jamie L. LaReau is the senior autos writer who covers Ford Motor Co. for the Detroit Free Press. Contact Jamie at jlareau@ Follow her on Twitter @jlareauan. To sign up for our autos newsletter. Become a subscriber.
Miami Herald
04-05-2025
- Automotive
- Miami Herald
New Study Forecasts How Softened Tariffs Will Affect Car Prices
A new study has predicted that President Trump's adjusted tariffs, which he amended on April 29, won't stop car prices from rising but will likely slow the rate of increase. The analysis, researched by Michigan-based Anderson Economic Group (AEG), forecasts that the least impacted vehicles will see a tariff burden of $2,000+. At the same time, the most affected models will incur tariffs exceeding $12,000. Vehicles assembled in the U.S. with substantial U.S. parts, like the Honda Civic and Odyssey, Chevrolet Malibu, Toyota Camry Hybrid, and Ford Explorer, are likely to see tariff burdens ranging from $2,000 to $3,000. AEG estimated that a large portion of the auto market would incur a medium tariff impact ranging from $4,000 to $8,000. This category consisted of models like the Chrysler Pacifica, BMW X3, Ford Bronco Sport, Volkswagen Jetta, and some Jeep and Ram models. Models in the $10,000 to $12,000 high-impact category mostly involve full-size luxury SUVs and some battery electric vehicles (BEVs), like the Mercedes G-Wagon, Land Rover and Range Rover models, and Ford's Mustang Mach-E. AEG noted that Trump's tariff amendments reduce levy costs for some vehicles assembled in the U.S. but don't eliminate costs from any model the group studied. As for cars assembled in other countries, even those with substantial U.S. parts didn't experience significant tariff price reductions. For example, Ford's Explorer, manufactured in Illinois, had its tariff impact drop from about $4,300 to $2,400. Others, like the all-electric Mustang Mach-E, which is assembled in Mexico, will maintain its high tariff rate of over $12,000. Variants of the Chevrolet Suburban, GMC Yukon, and Cadillac Escalade are made in Texas, and their tariff burden is projected to drop from $11,000 to just below $8,000. "The sales surge in March confirms that Americans expect prices to go up because of tariffs, and the revised AEG estimates confirm they are right," said Patrick L. Anderson, the study's lead author. Trump's new executive order, signed on April 29, prevents multiple U.S. tariffs from being stacked on the same imported product for companies making vehicles in the U.S. while also giving carmakers partial rebates on tariffs paid for imported parts at 3.75% during the first year and 2.5% the second year before being phased out. The offset is only available for cars produced after April 3, though. AEG isn't the only group speaking out about the significant impact of Trump's tariffs, even with recent adjustments. "It's akin to having a car accident and saying, 'Oh good, it's not totaled, but it's still $20,000 worth of damage,'" Dan Ives, managing director of autos at Wedbush Securities, said in an interview with the Detroit Free Press. General Motors (GM) warned on Tuesday that the impact of Trump's amended tariffs could still be "significant" and that the company was "reassessing" its guidance while waiting on "greater clarity," according to NBC. Autoblog posed the question this week of whether Trump's adjusted auto tariffs would make a significant enough impact, and answers are starting to emerge. While US automakers like GM and Stellantis have received a break on the president's sweeping measures and expressed their appreciation, GM's warning on Tuesday reflects that much of the industry is remaining cautious and playing things by ear. In the meantime, car buyers can still expect prices to rise soon, but the rate at which these cost increases will occur might slow down due to Trump's new policies. Copyright 2025 The Arena Group, Inc. All Rights Reserved.
