Auto and Motor Vehicle Wholesalers NAICS 423110

Apr 3, 2025 - Automobile Imports Hit With 25% Tariff

• The Trump administration slapped 25% tariffs on all imported automobiles on April 2, claiming the levies will spur auto factory building in the US. The tariffs will apply to all imported passenger cars and light trucks. Certain auto parts will also be subjected to the levies such as engines, electrical components, and powertrain parts. This is in addition to reciprocal tariffs Trump also levied against specific countries that are key US partners in auto manufacturing. According to Cox Automotive, the tariffs will increase the price of imported passenger vehicles by an average of $6,000. In 2023, the US imported about $120 billion worth of automotive products from Mexico and Canada - roughly half of all US vehicle and parts imports. The move will likely spur retaliatory tariffs from other countries against the US, potentially driving auto prices even higher.
• US new light vehicle seasonally adjusted annualized sales (SAAR) rose 2.1% year over year in February 2025, totaling 16 million units, according to NADA Market Beat. The results were a dip from December 2024, which had the highest monthly SAAR in almost four years. Wards Auto estimates that auto sales in February will be about 1 million vehicles. Total fleet inventory of new light vehicles in the US, however, plummeted 16.3% year over year to 210,000 units. The drop in inventory is a result of the supply problems from on-again, off-again tariff threats against Mexico and Canada, key automobile and auto parts US trade partners. “American made” cars are loaded with Canadian and Mexican parts, and NADA Market Beat predicts that if Trump’s threatened tariffs go into effect, it will raise the average price of new vehicles from $4,000 to $12,000.

• Consumer confidence levels declined in December 2024, falling by 8.1 points from the previous month, according to The Conference Board. The Consumer Confidence Index was 104.7 in December 2024 from 112.8 in November 2024. Dana Peterson, chief economist at The Conference Board, noted that those remaining most confident on a six-month moving average basis confidence were those aged under 35 and those in the income category of over $100,000. Per Peterson, “The recent rebound in consumer confidence was not sustained in December as the Index dropped back to the middle of the range that has prevailed over the past two years.” Purchasing plans for homes decreased while plans to buy new cars and big-ticket items rose in December 2024 on a six-month average basis.
• Car repossessions increased 23% in 2023 compared to the previous year and were up 14% compared to pre-pandemic levels, as consumers struggle with financial pressures, according to Cox Automotive data reported by Jalopnik. Cars are typically repossessed after falling behind on car payments for several months. Monthly bills are becoming unaffordable for many vehicle owners due to inflation, higher car prices, and high interest rates. The average monthly payment for new car buyers in the US was $760 per month for an auto loan in May 2024, with 17% of owners making monthly payments of more than $1,000. On top of high monthly car payments, consumers are also facing significant increases in car insurance costs and rising housing costs, which are contributing factors to missed payments, according to the article.