Should You Buy a Car Right Now Because of the 2025 Vehicle Tariffs?
- Heather Boyle
- Mar 28
- 3 min read
What Exactly Are These 2025 Vehicle Tariffs?
Starting April 2nd, a 25% tariff will be placed on imported vehicles. Then, 30 days later, a 25% tariff will hit vehicle parts, particularly powertrain and electrical components. Let's clear up a few things because this seems scary:
Prices Won't Jump 25% Across the Board: While prices are likely to increase, it won't be a flat 25% increase on every car. Many vehicles are made right here in North America, and there are trade agreement loopholes based on where parts originate. We're probably looking at more of a 5-10% average increase in the next six months.
Parts Tariffs Are Important: The tariff on parts will impact repair costs down the line. This is definitely something to keep in mind for long-term ownership.
Manufacturer Reactions Are Varying: Some manufacturers, like Ferrari, have already increased prices, while others, like BMW are trying to "absorb" the tariffs for the next month to move stale product. Responses will differ from brand to brand.
So, Is it Smart to Buy a Car Right Now?
This really depends on your personal situation. But if you were planning to purchase soon anyway and you can take the time to get informed before you go, probably. Let's look at the pros and cons:
Buying Before April 2nd - Potential Benefits:
You might save some money if you act quickly. Prices will go up, and once they do, they tend to stay up.
You may have a better chance of getting the exact car you want before inventory becomes more limited.
If you were already planning to buy soon, doing it now avoids potential market chaos.
Buying Before April 2nd - Potential Drawbacks:
Dealers know people are concerned about tariffs, so expect less discounting and potentially more pressure to buy extras like warranties. The vibe is that they are VERY EXCITED to help panic buyers.
Market values will be highly inflated due to dealers making the most of the uncertainty.
You might be limited to what's currently in stock, which could mean compromising on color or features.
Rushing into a purchase without proper time to research could lead to making a decision you later regret.
How to Be Better Prepared
Here's how to make an informed decision and protect yourself:
Check Where the Car You Want is Made: Look at the window sticker or use this resource: https://www.nhtsa.gov/sites/nhtsa.gov/files/2025-01/MY2025-AALA-Percentage-1.17.25.pdf to see where your car and its parts come from. This will help you understand how much the tariffs might affect it.
Consider Risk vs. Reward: You might save a few thousand dollars by buying now, but don't expect massive discounts. Make sure the potential savings are worth the potential rush and limited inventory.
Think About Warranties and Add-Ons: Dealers will push these harder due to the tariffs. Know your driving habits and needs, and ALWAYS negotiate the cost or ask for added value (more coverage - in years or mileage).
Be Flexible: If buying before April 2nd, you may need to compromise on color and options and choose a vehicle on the lot. Try to locate the car you want in advance and manage your time at the dealership if you want to comparison shop.
Don't forget the basics: If buying before April 2nd, you can still get pre-approved for financing, research manufacturer incentives, and walk away if it feels icky.
What to Expect in the Coming Months
The car market will adjust. Prices will eventually stabilize, more inventory will become available, and things will return to a new normal. But there might be some turbulence in the short term, so patience will be key.
The Bottom Line
These tariffs are just a bump in the road, not a roadblock. You've got this, and we're here if you need us.
Pro Tip: The best car is the one that makes you feel confident and happy - tariffs or no tariffs!
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