Tariffs Tweak Auto Decisions

Car Shopping Woes

Just as the auto industry seemed to be back on track post-COVID, recent tariffs have added some tension to the turf. The focus on international trade tariffs during President Trump’s second term has given both automakers and car buyers a reason to pause. While there haven’t been any dramatic shakes in the availability of foreign models, the threat of tariffs has everyone holding their breath about potential hikes in new car costs.

Tariffs Influence

A recent Edmunds survey reveals that tariffs are on the minds of many buyers. Approximately 44% of respondents indicated that tariffs will definitely influence their purchasing decisions, and another 31% admitted they might sway their choices. Interestingly, though, new car prices haven’t taken a sky-high flight. In April 2025, the average transaction price for new cars was $48,422, showing a modest 2.2% rise from 2024. This suggests that while tariffs loom large in discussions, their direct impact on prices has been less severe than feared.

Feeling the rhythm of these potential pricing shifts, many buyers are strategizing. About 37% are speeding up their purchase plans to dodge possible tariff-related hikes, while 25% are playing the waiting game, hoping for smoother sailing down the line. The knowledge about tariffs seems split; 55% of buyers feel they have a good grasp on how these trade measures might affect the market, yet another 21% aren’t so sure.

Used Car Trend

With all the noise around new car expenses, some buyers are sliding over to the used car market. There’s been a noticeable shift towards checking out used vehicles, with 58% of survey respondents displaying increased interest. Within this group, 46% are specifically eyeing certified pre-owned cars, which gives them the assurance of thorough inspections and warranties.

The used car market is feeling a bit of a pinch, too. Reduced leasing and lower inventories over recent years have left fewer near-new vehicles available. Edmunds reported that the average price of a 3-year-old car hit $30,522 in early 2025, marking a 2.3% hike from the previous year. And these used cars are staying put on lots longer – averaging 38 days, which ties the longest recorded wait since early 2021.

Final Word

While the steady 2.2% bump in new car prices from 2024 might seem trivial, credit goes to automakers sticking to their guns with price guarantee programs. Initiatives like Hyundai’s Customer Assurance and Ford’s Employee Pricing have played their part. In fact, Ford saw a hefty 16% leap in sales in May 2025, and Hyundai wasn’t far behind with an 8% boost the previous month.

As for what the future holds, the response to auto tariffs will likely unfold over the coming months. Any new trade deals could potentially trim down duties on imports, making those international wheels a bit more affordable.