- Import prices from Canada and Mexico can add $2,100 to cars assembled in the US
- Cars made in Mexico can cost $8,000-$10,000 more
- It could also drive up the cost of EVs like the $35k Chevy Equinox EV
The Trump administration is promising 25% tariffs on all imports from Canada and Mexico could hit the Detroit Three automakers hard, raising prices not only for EVs but also for those automakers' flagship gasoline trucks, according to a recent report from Reuters.
GM is likely to see a big impact from these policies, which are steeped in the anti-immigration rhetoric that was a big part of Trump's campaign message but will disrupt long-established North American chains, according to Reuters.
GM is expected to import more than 750,000 vehicles to Canada and Mexico this year, according to a Reuters report, citing business analyst firm GlobalData. About half of those will be profitable full-size gasoline pickups that contribute heavily to the automaker's bottom line.
2025 Chevrolet Equinox EV
Separately, Reuters also notes that prices may affect the price of the Chevrolet Equinox EVcurrently GM's most affordable electric model. It's assembled in Mexico and costs $34,995 before the $7,500 federal EV tax credit Trump is expected to take.
Mexico is a major EV production center, with more EVs going to the US than sold domestically—but that's part of an overall trend related to all types of vehicles and the parts that go into them. As Reuters reports, 90% of light vehicles and 43% of auto parts produced in Mexico are exported to other parts of North America. GM, Ford, Nissan, and Stellantis lead in exports from Mexico to the US, but Toyota, VW, and Honda each brought more than 100,000 from Mexico in the first six months of 2024.
Trump's tariffs will apply to both whole vehicles and parts. 25% off parts from Canada or Mexico add $2,100 in fees to US assembled vehicle buyersagain $8,000-$10,000 for cars also assembled in Canada or Mexicoaccording to Reuters, citing estimates by Wells Fargo.
Ford Mustang Mach-E meeting – Mexico
Trump voters may feel that the financial pain is too much. While most pickup trucks are assembled in the US, a good portion of popular models, including not only GM's Chevrolet Silverado and GMC Sierra, but also the Ford Maverick, Ram 1500, and Toyota Tacoma are built in Mexico. So the most popular cars in rural areas that voted heavily for Trump will be affected by the tax, Reuters said.
Trucks are at least profitable, allowing automakers to absorb cost increases rather than pass them on to consumers. That may not be the case with more affordable cars like the Nissan Sentra, longtime industry analyst Sam Fiorani told Reuters. And that may not be the case with EVs.