Car prices stand to rise as Trump tariffs take hold, but not at Toyota
The 2025 auto industry boogeyman is here. It’s a 25% tariff on all foreign cars, and it stands to increase car prices across the market, regardless of final assembly location. Still, even with wallet-busting tariffs in effect, Toyota says it doesn’t intend to raise prices. At least, not yet.
Toyota says it will maintain its car prices even as Trump’s tariffs threaten the brand’s US operations
President Donald Trump’s 25% auto tariffs have automakers bracing for impact. The tariffs, while intended to galvanize the domestic automotive industry, will hit US car buyers with higher car prices across the board. That is, unless you’re shopping for a Toyota.
Toyota announced that it would continue its US operations as usual, even with the latest tariffs in effect. It also said it would endeavor to reduce fixed costs to mitigate the impact of the auto tariffs. Toyota didn’t, however, make any mention of rising car prices for US consumers. “While closely monitoring developments from US authorities including tariffs, we’ll work on reducing fixed costs and maintain our current operations for the time being,” Toyota said in a statement.
It’s good news for fans of the best-selling SUV in America, the Toyota RAV4. Last year, the RAV4 outsold the market top dog, the Ford F-150, to take the sales crown for 2024. However, analysts and industry professionals are less than optimistic that Toyota will be able to maintain its operations without passing price hikes on to its buyers.
It’s not just the prices of foreign cars, either. Former Ford CEO Mark Fields told CNN Business that “the cost of vehicles will go up. It’s just math. The bottom line is there is absolutely no vehicle that won’t be impacted by tariffs.”
Early estimates put car prices rising by between $5,000 and $15,000 for foreign cars. However, Bank of America puts the industry-wide average for US-made vehicles at $3,285. Even American cars are going to get pricier.
When asked about whether he is concerned about the impact on the American consumer, Trump said he “couldn’t care less.” Moreover, Trump told interviewers, “I hope they raise prices because if they do, people are gonna buy American-made cars.”
