KBB: New Tariffs Will Likely Mean Higher Auto Prices
From car prices to car insurance, every aspect of the automotive industry will feel the impact of the tariffs…
After the Trump administration announced that new tariffs would go into effect on March 4, Kelley Blue Book (KBB) released a report on how the changes could affect the automotive industry and consumers. The tariffs include a 25% fee on all Mexican and Canadian imports, and the originally announced 10% tariff on Chinese products has been doubled to 20%.
KBB estimates that the average price of a new car could rise by a minimum of $3,000 and could go as high as $10,000 on a full-size truck. Used car prices will likely rise as well, and the short supply of used cars on dealers’ lots could exacerbate the situation. The cost of car repairs will increase as well, directly impacting car insurance rates, which could increase by up to 8%.
KBB states that the new tariffs won’t affect the price of cars that are currently on dealers’ lots, so it will be several weeks before consumers start to see price increases, prompting some consumers to purchase a new vehicle sooner than later. Car manufacturers have few options to change supply lines to avoid the tariffs, and some may even halt production, taking a wait-and-see approach.
To read KBB’s full report on the new tariffs, visit this link.
