(NewsNation) — The cost of some new cars could jump by $12,000 due to President Donald Trump‘s newly enacted tariffs on top trade partners China, Canada and Mexico, a new automotive consultant study found.
On Tuesday, 25% tariffs were placed on imports from Canada and Mexico, and an additional 20% tariff was placed on those from China. Energy resources from Canada will have a lower, 10% tariff.
Michigan-based automotive consultant Anderson Economic Group’s latest data points to these levies as potential price drivers, Bloomberg first reported.
Analysis shows the cost of building a crossover utility vehicle will rise by at least $4,000, with electric vehicles seeing a three-fold increase of $12,000.
That’s on top of already high prices due to inflation, with the average new car transaction last month ringing in at $49,740, per Kelley Blue Book.
Which automakers will feel biggest impact from Trump’s tariffs?
According to new Edmunds data, 48.6% of all new vehicles sold through February were built in the United States. Another 17.4% were built in Mexico, 7.4% in Canada and 26.5% elsewhere.
Some automakers rely on our North American neighbors more than others. Nearly half, 45%, of Volkswagen’s vehicles are built in Mexico, followed by Nissan (35%) and GM (28%).
Roughly one-fourth of new Hondas sold in America come from Canada.
“In the short term, automakers will need to pull every available lever to minimize disruptions and soften the immediate impact, but there’s no escaping the fact that higher costs will ultimately be passed on to consumers,” Jessica Caldwell, Edmunds’ head of insights, said in a statement.
Other makes and models that could see massive price shifts include the Chevrolet Silverado pickup truck and the Ford Bronco Sport SUV, multiple outlets report.
Pricier production will directly impact customers and potentially hurt sales, Patrick Anderson, CEO of AEG, told Bloomberg.
“That kind of cost increase will lead directly — and I expect almost immediately — to a decline in sales of the models that have the biggest trade impacts,” Anderson said.
What impact do Trump’s tariffs have on the economy?
The automotive industry is just one that will likely feel the burn from Trump’s tariffs and subsequent international retaliation.
Americans could see higher prices on a range of goods the U.S. imports from its top three trading partners, including vehicles, fruits and vegetables, smartphones, toys, laptops and even fuel at the pump.
A 2024 paper by a group of top economists looked at Trump’s 2018 tariffs and found that “import tariffs on foreign goods neither raised nor lowered U.S. employment in newly-protected sectors.” However, retaliatory tariffs had “clear negative impacts,” primarily in agriculture.
NewsNation’s Andrew Dorn and the Associated Press contributed to this report.