The United States' new 25 percent tariff on imported automotive parts officially came into effect on Saturday, sparking concerns over its potential long-term impact on both U.S. consumers and car manufacturers.
According to reports from U.S. media, the tariff is expected to significantly raise costs for the U.S. auto industry, potentially reshaping the landscape of the sector permanently.
For each vehicle, the additional tariff could add up to 4,000 dollars to the overall cost. Analysts warn that the move could result in an increase in costs for the automotive industry by billions of dollars in the coming months.
General Motors (GM) has already projected losses of four to five billion dollars this year due to the tariff. With vehicle prices expected to rise, repair costs are also set to soar, further exacerbating inflationary pressures across the U.S. economy.
To mitigate the effects of the tariff, U.S. car dealerships had ramped up inventory in advance, but reports indicate that these stocks are expected to run out by July.
In a related statement, California Governor Gavin Newsom expressed his concerns about the U.S. tariff policy, stating that global trade is not a zero-sum game and that trading partners are fundamentally interdependent.
Trump's trade policy, he added, has had a severe impact not only on trade but also on tourism, harming both small businesses and large corporations, and inflicting "incalculable" damage to U.S. credibility.
Investment mogul Warren Buffett also weighed in on the issue, warning that the new tariff policy could have severe global repercussions, calling it a "big mistake."
US auto parts tariff takes effect, raises domestic woes
