U.S. Car Sales Surge in Q1 Amid Rush Before Expected Price Increases Due to Tariffs
3 April 2025 路 Uncategorized 路
Recent data indicates that the United States experienced a robust first-quarter performance in auto sales, reflecting consumer efforts to purchase vehicles ahead of tariffs taking effect and causing prices to rise.
According to reports from Reuters and CNN among others, Wards Intelligence released figures showing US new car sales reached approximately 3.91 million units this quarter, marking an increase of 4.8% compared with the same period last year; electric vehicle (EV) sales grew by a staggering 19.2%.
The data reveals that auto giant General Motors saw its first-quarter sales rise by 17%, driven largely by strong demand for economy crossover SUVs like Trax, which are produced in South Korea. Sales also increased among Japanese and Korean automakers such as Toyota, Hyundai, Honda; Ford's sales dropped slightly by 1.3% due to the cessation of production on certain models.
President Trump announced plans starting April 3rd to impose a 25% tariff on non-US manufactured automobiles and some parts thereof. Given that major US car manufacturers have assembly lines in countries like Mexico or Canada, as well as importing many components from overseas markets, they are bound to be significantly impacted by this new policy. Consumers fear the tariffs will lead to price hikes of thousands of dollars per vehicle and thus rushed towards dealerships before these measures take effect.
Automotive data provider Edmunds noted that fears over impending tariffs have boosted first-quarter car sales; however, once implemented, consumers may see fewer low-cost imported vehicles available on the market such as Ford's Maverick compact pickup truck produced in Mexico. The average price of a new US vehicle is now approaching $50,000.
Cox Automotive also pointed out that these tariffs could lead to inflationary pressures and dampen sales for 2025 model year cars. Earlier reports suggested Trump had warned auto executives not to pass on the costs from tariffs onto consumers through price hikes; however, he later denied this claim stating his indifference towards whether carmakers raise prices in response.
Analysts at Deutsche Bank estimate that General Motors (GM), Ford Motor Company and Stellantis would need a 5.8% increase across their pricing structures just to offset tariff impacts while Tesla, despite being less affected by tariffs overall, still needs an estimated price hike of around 1.8%.
(Translated from MoneyDJ News; Image source: Unsplash)
According to reports from Reuters and CNN among others, Wards Intelligence released figures showing US new car sales reached approximately 3.91 million units this quarter, marking an increase of 4.8% compared with the same period last year; electric vehicle (EV) sales grew by a staggering 19.2%.
The data reveals that auto giant General Motors saw its first-quarter sales rise by 17%, driven largely by strong demand for economy crossover SUVs like Trax, which are produced in South Korea. Sales also increased among Japanese and Korean automakers such as Toyota, Hyundai, Honda; Ford's sales dropped slightly by 1.3% due to the cessation of production on certain models.
President Trump announced plans starting April 3rd to impose a 25% tariff on non-US manufactured automobiles and some parts thereof. Given that major US car manufacturers have assembly lines in countries like Mexico or Canada, as well as importing many components from overseas markets, they are bound to be significantly impacted by this new policy. Consumers fear the tariffs will lead to price hikes of thousands of dollars per vehicle and thus rushed towards dealerships before these measures take effect.
Automotive data provider Edmunds noted that fears over impending tariffs have boosted first-quarter car sales; however, once implemented, consumers may see fewer low-cost imported vehicles available on the market such as Ford's Maverick compact pickup truck produced in Mexico. The average price of a new US vehicle is now approaching $50,000.
Cox Automotive also pointed out that these tariffs could lead to inflationary pressures and dampen sales for 2025 model year cars. Earlier reports suggested Trump had warned auto executives not to pass on the costs from tariffs onto consumers through price hikes; however, he later denied this claim stating his indifference towards whether carmakers raise prices in response.
Analysts at Deutsche Bank estimate that General Motors (GM), Ford Motor Company and Stellantis would need a 5.8% increase across their pricing structures just to offset tariff impacts while Tesla, despite being less affected by tariffs overall, still needs an estimated price hike of around 1.8%.
(Translated from MoneyDJ News; Image source: Unsplash)