by Rising car prices in the US due to tariffs
A new study shows that the average price of cars in the US will increase by $1,760. This is due to the introduction of additional tariffs on imported cars. Although many manufacturers are so far refraining from raising prices, experts believe that about 80% of the cost of tariffs will be passed on to buyers. This could lead to a decrease in sales of one million cars over the next three years.
Companies such as General Motors and Ford are already estimating their losses due to tariffs at $5 billion and $2.5 billion, respectively. Ford has already raised prices on some models, including the Maverick, Bronco Sport, and Mustang Mach-E, by up to $2,000. However, if tariffs are reduced from 25% to 7.5%, the situation may improve.
“The tariff barrier is unlikely to last forever,” noted Mark Wakefield, an expert at AlixPartners.
Impact on the electric vehicle market
Changes in tax incentives for electric vehicles may force buyers to choose internal combustion engine (ICE) cars or hybrids more often. According to forecasts, by 2030 the market share of electric vehicles could shrink from 31% to 17%, while traditional cars will account for about 50%, and hybrids for 27%.
Despite current difficulties, the possibility of tariff reductions and manufacturers’ adaptation to new trade conditions could stabilize the situation. However, for now, buyers should be prepared for higher prices, especially on popular models.
