Car tariffs affect the "working class" - The consequences of Trump's measures will be felt by his core supporters
Working-class car buyers will be hit hardest by U.S. President Donald Trump's 25% tariff on imported vehicles. That's because almost all new low-cost cars sold in the United States are built elsewhere.
Lower-income buyers will suffer another blow from expected increases in used car prices, as demand increases and supply shrinks.
New cars priced under $30,000 are now rare as the average price of new vehicles approaches $50,000. Analysts say the only way automakers can make a profit from economy cars is to build them in countries with lower production costs.
A Reuters review of data from two automotive research firms found only 16 models with an average price of less than $30,000 and only one, Toyota's Corolla, that is assembled in the United States. All the others are made in Mexico, South Korea or Japan.
Imposing a 25% tariff on these low-end cars could force price hikes that make them unaffordable for their target market and some automakers will abandon them altogether, industry analysts said.
"New vehicles will be more expensive," they explain. "This will push more buyers into the used car market, which will also drive up prices."
"Most families who need a family car are paying prices approaching half the value of their home. The fundamental problem is that nothing is being done to make domestically produced vehicles more affordable," sector experts emphasize.
Trump's rural base could bear the brunt of the import tax. About half of voters reporting a household income of less than $50,000 a year supported Trump's reelection in 2024, along with 56% of voters without a college degree, according to an Edison Research poll.
Trump has said he doesn't care if automakers raise prices, "because if prices for foreign cars go up, they'll buy American cars."
Many of these foreign cars are made by American automakers, including three sub-$30,000 vehicles from GM. These models are assembled in South Korea. GM also makes hundreds of thousands of trucks in Mexico.
Trump argues that the tariffs will spur a boom in the U.S. auto industry. Some experts say high import taxes will have the opposite effect.
"As vehicle affordability decreases due to higher prices, families may begin to prioritize other areas of their budget, cutting back or delaying major purchases," they explain.
Poll
Why are Trump's trade wars threatening already vulnerable beer producers?!
American brewers already have enough problems. But now there's a new threat: President Donald Trump's tariffs, including 25% taxes on imported steel and......
EU to fine Apple and Meta - Commission decisions risk escalating tensions with the US
The European Commission is expected to fine Apple and Meta this week for violating EU digital competition rules, drawing the big companies into the trade war......
DPT: April 1st deadline for submitting DIVA 2024 and Profit Tax Declaration
As announced on the Tax Administration's social media, tomorrow, April 1, 2025, is the deadline for submitting DIVA 2024. The same deadline, April 1, 2025,......
Police salaries in Europe: Which countries pay officers the most and the least?
Police play a vital role in maintaining public order and ensuring the safety of citizens. To support these essential services, European governments allocate......
How could the European Central Bank react to Trump's trade tariffs?!
The European Central Bank (ECB) is bracing for renewed economic uncertainty as U.S. President Donald Trump prepares to impose a wide range of tariffs. On......
Insurance companies pay 1.2 billion lek in damages - AMF: About 1.28% less than in 2023. Most of it belongs to motor insurance
Claims paid by insurance companies have decreased. Around 1.2 billion lek is the amount of claims paid by insurance companies in January-February of this......
"VAT will be reduced to 15%" - Sali Berisha presents the "Made in Albania" program in detail
The leader of the Democratic Party, Sali Berisha, has presented in detail the "Made in Albania" program, which aims to promote production in Albania.......
Higher Education, 1 billion lek collected in 2024 - Instat: The number of registrations has decreased by 14% in 4 years
Even with a decrease in the number of students in the auditoriums of Albanian universities, data from the Ministry of Finance shows that during the past......
