Trump tariffs: Car prices, repair costs expected to go up

MILWAUKEE - Get ready to pay more to fix your car or buy a new car: President Donald Trump announced new 25% auto import tariffs on Wednesday. Here's what it means for you.

Big picture view:

Trump's tariffs on auto imports will start next week, and tariffs on parts will start soon after. 

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Kelley Blue Book said the average new car costs about $48,000. Wall Street analysts give different estimates of how many thousands of dollars the tariffs could add to consumers' sticker price.

"It depends on whether or not they have factories here," Trump said. "I can tell you if they have factories here, they're thrilled. If you don't have factories here, they're going to have to get going and build them because, otherwise, they have to pay tariffs. Very simple."

The president’s proclamation cited national security worries and brought up supply chain problems during the COVID-19 pandemic that led to car inventory shortages. Trump said only about half of the cars in the U.S. are made in the country.

What they're saying:

The White House said the tariffs will raise $100 billion per year.

Ontario, Canada’s premier, said the new tariffs will only increase costs for hard-working Americans. The United Auto Workers union praised the move. 

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Local perspective:

On average, Milwaukee car dealerships have a 90-day supply – cars that won’t have the added cost of the tariffs.

"Maybe they’re thinking now is the time to buy because these tariffs are going to come out," said Deb Kruse, Automobile Dealers Association of Metro Milwaukee president. "I do know the dealers are ready for that because we’ve talked about that much earlier."

Thursday was Kruse's first day leading ADAMM, a group that represents 105 dealership sin six Metro Milwaukee counties.

"We won’t know until this happens. But we’re all waiting. We’re waiting to see what happens," she said.

Repair shops are also waiting and watching. Riverside Auto's Peter Bilgo said their parts distributors are stocking up now.

"Who are the winners in this? Sometimes the used car industry. They’re going to see a boom, and used car sales," said Bilgo. "Price is that the price is that we charge, like I told you on the phone, are based upon our cost. And as our costs go up, like anything else that gets passed on to the consumer. You try to keep it reasonable, but again you’re in business to make a profit."

Riverside Auto

What's next:

Trump's order said the 25% tariffs on parts will start no later than May 3. For now, parts covered under the 2018 United States-Mexico-Canada Agreement are exempt.