Tariffs imposed by the Trump Administration are expected to negatively impact the U.S. auto parts industry. In September, a 10 percent tariff was placed on $200 billion worth of Chinese goods and that tariff will rise to 25 percent in January.
These tariffs pinpoint several automotive products, including brake rotors, crank shafts, engines, hydraulic and brake fluids, transmission shafts, and more. Those in the automotive industry report that the price of car and truck parts will be rising as result of the tariffs. That means that whether you are looking to buy a new vehicle or just parts, you will be spending more money to do so in the very near future. The price for any automotive parts made with steel are expected to be impacted the most.
A trade war with China means that those in the automotive industry may look to get parts from other countries but that would be a long process that could take years. It is also likely that many companies would have to be sure that a particular tariff will be permanent before taking such measures.
Car and truck owners are likely to begin paying more for replacement auto parts such as mirrors, windshield wipers and tires. Higher prices may even lead some car and truck owners to delay or forgo some repairs altogether. This is a mistake, however, since putting off or skipping repairs can cost you much more in the long run and can prove to be dangerous.
Purchasing a new car or truck isn’t the answer, either, since those prices are expected to rise, as well. A 25 percent tariff would increase the average price of a new vehicle by approximately $4,400. The National Automobile Dealers Association says that a tariff of 25 percent would result in the following:
- Two million fewer cars and trucks would be sold annually.
- A loss of almost 715,000 jobs.
- A $59 billion drop in the gross national product.
- An increased demand for used cars.
- A rise in the cost of owning a car or truck.
- A drop in the number of jobs at new-car dealerships.
If you are considering having work done on a car or truck or are in the market to purchase a new vehicle, now is the time to make a move. While it may not have happened yet, experts warn that Americans are going to soon feel the pinch and it’s going to be significant.
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