



Car prices have already climbed out of reach for many Americans. The search for a cheap car is poised to get even tougher.
President Donald Trump’s tariffs on automobile imports set to take effect next week are expected to drive up costs across the industry, raising sticker prices by thousands of dollars. The effects could be particularly pronounced at the low end of the market, with many of the least-expensive models from the likes of General Motors, Ford, Kia and Hyundai being built outside the U.S.
“It’s going to be a real struggle for those buyers,” said Erin Keating, executive analyst at researcher Cox Automotive. “We only expect prices to rise and incentives will go away. Some vehicles could go away.”
A shiny new car in the driveway is a rapidly disappearing piece of the American dream alongside an affordable home. The average price of a new car in the US now approaches $50,000, with high interest rates adding to the financial toll.
There are 20 models on the market priced below $30,000, according to Cox, and at least half of them will be hit severely by the new tariffs. Among the vehicles assembled in Canada or Mexico, costs would rise by $5,855 on average, it estimated in a recent research report.
“The impact on ‘affordable’ vehicles would likely make many of them unviable in the US market,” Cox said in the report.
Detroit’s automakers have already abandoned much of the passenger car market to prioritize more profitable crossovers and SUVs, ceding the small sedans that have historically accounted for many of the industry’s most-affordable cars to automakers based in Asia.
Trump has cast the tariffs as “permanent,” but it’s unclear how long they’ll last, and whether concessions from trading partners could result in the levies being reduced or lifted.
But for now, the duties will hit many of the domestic industry’s entry-level offerings that are largely imported from countries with lower labor costs and supply-chain advantages. GM builds the low-priced Chevrolet Trax compact SUV and the Trailblazer crossover in South Korea. Both are among GM’s cheapest vehicles.
GM has had a hit with the Trax, which starts about $20,000. The most well-equipped Activ trim level starts at less than $26,000. GM sold more than 200,000 of the Trax in the U.S. last year and did so profitably thanks to Korea’s cheaper supply base. The vehicle will soon face a 25% tariff, which will force GM to make tough decisions on how to handle the extra cost.
Stellantis NV makes its least expensive Jeep — the Compass SUV — in Mexico and brings the Dodge Hornet to the U.S. from Italy. Ford imports the entry-level Maverick small pickup from Mexico, as well as the Bronco Sport compact SUV.
On a Thursday call with investors, Stellantis Chairman John Elkann voiced concern that “the affordability of our products made in America” and the “uncertainty” stoked by the tariffs could hurt demand in the U.S.
“It is critical that tariffs are implemented in a way that avoids raising prices for consumers” and maintains North America’s competitiveness as a global auto production bloc, the American Automotive Policy Council said in a Wednesday statement. The group, which lobbies on behalf of Ford, GM and Stellantis, said it was committed to advancing Trump’s goal of increasing jobs and production in the U.S.
Hyundai’s cheapest vehicle — the Venue small crossover — and its entry-level Elantra sedan are built in South Korea, which also supplies the vast majority of each model’s parts, according to National Highway Traffic Safety Administration data. Affiliate Kia’s entry-level Soul small crossover is also made in South Korea and its K4 sedan is assembled in Mexico.
Mexico also supplies Nissan Motor Co.’s least-expensive models for U.S. consumers, including the Kicks small SUV, Sentra compact car and Versa subcompact.
The bargains in the cheap-car market could end up being from Honda and Toyota The roughly $28,000 Honda Civic hatchback is made in Indiana. Toyota builds its Corolla compact in Mississippi and starts about $23,000.
Trump has acknowledged that car prices are likely to rise due to tariffs, but he argues that any short-term pain would be offset by long-term gains in domestic manufacturing. Besides the 25% levy on auto imports announced this week, the U.S. plans additional tariffs on other industries and specific countries.