Auto tariffs are set to hit the street on April 3, and car buyers are struggling to decide whether they should rush or not before the price takes a hike
Experts are of the view that these tariffs could lead to a rapid increase in the prices of vehicles, with a potential range of between $5,000 to $10,000 and as much as $20,000 in some cases. However, it is still uncertain exactly when these hikes will be powered, but consumers are of the view that they need to act fast.
Joseph McCabe, the CEO of AutoForecast Solutions said in this regard that – “You’ll see a lot of people going to dealership lots sooner rather than later because they have no idea when or how much the tariffs will hit them in the wallet.”
Auto tariffs are here. Breaking down the announcement–and trying to read some tea leaves about the future. Pro tip: get to your car dealership this weekend.
1. Starting April 3, the U.S. will impose 25% tariffs on imported autos. There will also be a 25% tariff on imported…
— Peter Harrell (@petereharrell) March 27, 2025
Talking about the vehicles to which the tariffs will apply, 25 % of it will be applicable to imported passenger vehicles. It includes cargo vans, minivans, light trucks, and even SUVs. Even the cars which are manufactured in the United States will not be immune to price increases either as automakers hugely rely on imported parts.
A personal finance expert at NerdWallet, Kimberly Palmer, said – “It’s a really complex situation, but the bottom line for consumers is that the price of cars will be going up. If you know you need to buy a car – it’s something you’ve already decided and worked into your budget – then it could make sense to speed up your timeline.”
Aaron Bragman, Detroit bureau chief at Cars.com, was more straightforward: “Try to get a vehicle now if you can.”
Well, the real bomber is not only the price of new cars will increase, rather used cars will tentatively see a price hike as well because shoppers want to avoid those inflated costs and hence are opting for pre-owned options.
“The vehicles that are in the more affordable range — let’s say below $30,000 — they will potentially be squeezed out of the market,” McCabe noted.
However, several risk factors also persist in case a person wants to rush directly to a car purchase. As the high interest rates will be driving up the borrowing costs, a car loan in this situation reflects the enormous monthly payments you need to provide.
As per experts, buyers go through some basic steps for closing the best loan terms. This includes all the running credit reports for comparing the financial offers and also addressing the errors. This reflects the fact that shopping does take time, but it definitely leads to huge savings.
However, buying a vehicle means financial strains continue even after buying it. These upcoming tariffs are likely to increase the costs of car repairs and insurance, too.
“Buying a car is such a big financial decision. It’s expensive, and it has a huge impact on your finances, so you don’t want to rush if you’re not ready,” Palmer cautioned.
However, for people for whom having a car is a necessity, the choice is clear, but others need to make their decision cautiously concerning the tariffs.
