U.S. auto sales boosted by anticipation of new tariffs

U.S. buyers accelerated their vehicle purchases in the first quarter of 2025, snapping up more trucks and SUVs ahead of expected tariffs on auto imports. The looming 25% tariff, set to take effect on April 3, raised concerns about higher prices on imported cars, with estimates suggesting increases of up to several thousand dollars per vehicle. This drove buyers to secure deals before the levy could push prices higher.

General Motors (GM) led with a 17% increase in sales, boosted by high demand for its affordable crossover SUVs, like the Chevrolet Trax produced in South Korea. Other automakers, including Hyundai, Mazda, and Honda, also saw a positive shift in sales, driven by similar pre-tariff buying behavior.

Electric vehicle (EV) sales jumped by 19.2% in the first quarter, according to Wards Intelligence, signaling continued consumer interest in eco-friendly alternatives. However, Tesla’s sales showed signs of slowing down, with analysts attributing the decline to weakening demand for its older models and a growing public backlash against CEO Elon Musk’s politics.

The total number of new vehicles sold in the U.S. during the first quarter reached approximately 3.91 million, marking a 4.8% increase compared to the previous year. While automakers saw a boost in the short term, experts like Jessica Caldwell from Edmunds caution that the tariffs could lead to price hikes and a subsequent reduction in sales later in the year.

Ford and Toyota report mixed results

Ford reported a modest 1.3% drop in sales, citing the discontinuation of certain models and the timing of rental fleet sales as contributing factors. Toyota’s North American unit, however, saw a slight increase of around 1%, while Hyundai’s North American CEO, Randy Parker, noted that the final week of March was the busiest in a long time, with many customers rushing to buy vehicles ahead of the tariffs.

Industry experts warn that the expected price hikes could slow sales in the year’s second half. Doug Demuro, the owner of an online auction site, noted that the tariff-driven price increases could reduce affordability, especially for lower-cost imports like Ford’s Maverick pickup truck.

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