Home Cars Trump’s 25 percent tariff could cost you more than $700 per year per car

Trump’s 25 percent tariff could cost you more than $700 per year per car

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President Donald Trump’s proposal to put a 25 percent tariff on imports could hurt more than just new cars sales, according to a Reuters report. It could cause higher repair costs, insurance costs and more car thefts.

“Consumers will bear virtually all the higher repair costs,” according to the American Insurance Association, National Association of Mutual Insurance Companies and Property Casualty Insurers Association of America in comments jointly submitted to the Commerce Department.

The coalition also says premiums could go up by 2.7 percent, partially due to not being able to get parts as quickly. The Auto Care Association, which represents 150,000 manufacturers, distributors and sellers, said that the cost of car ownership could go up $700 per year per car. The insurance groups also noted that car thefts could rise if parts are worth more.

The Commerce Department will hold a hearing about the tariffs Thursday and will send a report to the White House after “collecting all the facts and completing a careful analysis.”

Several members of the tire industry also sent a letter to the Commerce Department against the tariffs. Michelin, Cooper and Sumitomo are worried that rising costs will make people wait longer for before buying a new vehicle, as well as spend less on maintenance.

"We are concerned that consumers waiting longer to replace their tires will result in increased traffic accidents and fatalities," they said.

Additionally, seven auto industry trade groups “representing nearly every major automaker, auto dealer and parts companies” sent a letter to President Trump saying that the tariffs are a “massive tax” on consumers that will lead to "increased vehicle service and repair costs that may result in consumers delaying critical vehicle maintenance."

We'll learn more next week after the Commerce Department meets.

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