(NewsNation) — The threat of tariffs has driven Americans to buy cars before prices start to rise, with both used and new car lots seeing an uptick in customers over the past month.
Expected 25% tariffs will drive up the price of new cars, but used cars will likely be hit too as imported parts are subject to tariffs.
For dealers, the threat of tariffs has been great because customers are speeding to the lots to buy cars before the price goes up.
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Automakers sold more than a million and a half vehicles in the U.S. in March, bringing total sales for the first quarter to just under $4 million. Electric vehicles have surged in sales as well.
Major car companies have reported double-digit gains. GM is up 17% for the first quarter overall, and in March alone, Ford was up 10%, Toyota was up 8%, Honda was more than 13%, and Hyundai and Kia were also up 13%.
Used car dealership owner Mark Gonzalez said he is bracing for the impact of tariffs.
“I don’t think anybody knows what to expect right now,” he said. “In terms of parts, I think the tariffs are going to affect this greatly. Every time we need a part and it’s made overseas, it’s going to be coming in taxed at the 25%, which is going to increase our repair bills.”
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As those repair bills cut into the profit margin, the cost will most likely be passed on to consumers, with an expected 5% increase on used car sale prices alone.
The stock market has been up and down as tariffs have been announced and rescinded, but currently, automakers are up, suggesting companies are positive about the future despite the upcoming tariffs.
