From Yahoo Finance: 2025-03-27 13:15:00

President Trump announced a 25% tariff on imported cars and auto parts, raising costs for manufacturers and consumers. GM and Ford will face billions in costs, while EV makers like Tesla and Rivian are less affected. Analysts estimate car prices may rise by 12%. Shares of automakers fell after the announcement.

The tariffs benefit U.S. automakers like Ford and GM, but GM remains the most exposed due to sourcing vehicles from Canada, Mexico, and South Korea. JPMorgan analysts estimate GM’s tariff costs at $13 billion and Ford’s at $4.5 billion. International automakers like Ferrari are at a disadvantage.

JPMorgan lowered price targets for GM, Ford, and Ferrari due to the tariffs. Electric vehicle makers like Tesla, Rivian, and Lucid are less exposed. While they source parts from Canada and Mexico, the impact on prices is still significant. Trump’s tariffs target automobile parts including engines and transmissions.

Suppliers may be better positioned than carmakers but will still be affected. Negotiating cost-sharing deals with manufacturers may help, but less demand from consumers could hurt. Aptiv is considered the worst-positioned supplier, while Gentex is in a better position. Suppliers may consider relocating production to cheaper countries.

The impact of the tariffs on suppliers and manufacturers remains uncertain. Companies like Lear have already moved production from Mexico to Honduras to offset costs. JPMorgan analysts believe that suppliers could mitigate tariff costs by relocating production to less expensive countries.



Read more at Yahoo Finance: These Car Stocks Could Feel the Most Pain Under Trump’s Auto Tariffs