DRIVERS are rushing to dealerships to buy cars before new tariffs go into effect but they need to be careful, an expert has warned.
Car prices are expected to skyrocket by as much as $12,000 when President Donald Trump’s tariffs take effect.
The expected price surge is the result of a 25% tariff on imported cars and auto parts that is set to take effect on April 2.
Trump announced the new tax on March 26, citing unfair trade agreements with other countries as the reason for the hike.
“We’ll effectively be charging a 25% tariff, but if you build your car in the United States, there is no tariff,” Trump said last week.
“What that means is a lot of foreign car companies are going to be in great shape because they’ve already built their plant [in the US].”
Car salesmen say prices haven’t increased yet – but that won’t last long.
“Our pricing hasn’t been affected yet,” Jeremy Lane of Autoline Preowned told Jacksonville, Florida, Fox and CBS affiliate WJAX.
“We’re expecting it to be soon.”
Lane said prices could shoot up by anywhere from $5,000 to $12,000.
Dealerships are already seeing a flood of customers as buyers look to lock in current prices.
“If you’re already in the market to buy a car, go ahead and speed that process up just a little bit,” said Brian Moody of Autotrader.
But he urged shoppers to avoid letting urgency cloud their judgment.
“What happens when there’s pressure, people sometimes start to look for amazing deals,” Moody said.
“So just like always, if it seems too good to be true, it probably is.”
A total of 45% of vehicles sold in the US are imported with the largest share coming from Mexico and Canada.
Certain automakers, like Mazda and Volvo, are expected to be hit hardest by the tariffs as they import a large portion of their cars into the US.
Only 13% of Volvo cars are made in the US, Axios reported.
Mazda, meanwhile, makes 19% of its cars in the US while Volkswagen is at 21%.
In the 2025 model year, many popular vehicles like the Ford Maverick, Chevrolet Blazer, Hyundai Venue, Nissan Sentra, Porsche 911, and Toyota Prius are imported from other countries, according to the Department of Transportation.
The White House anticipates $100 billion in annual revenue from the tariffs but experts warned that consumers will likely bear the burden.
Automakers must choose between absorbing the costs or increasing prices with analysts expecting the latter.
“We’re looking at much higher vehicle prices,” warned Mary Lovely, senior fellow at the Peterson Institute for International Economics.
Analysts say the new tariffs could push the average price of a new car well beyond $50,000.
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