Surge in Car Sales Ahead of Trump’s New Tariffs

Surge in car sales general Motors and Hyundai saw a rise in U.S. sales, driven by fears of price hikes due to Donald Trump’s tariffs. GM reported a 17% growth in the first quarter, with a 15% increase in retail sales. Ford and Toyota also posted moderate quarterly gains.

Immediate Impact on the Auto Industry

The tariffs have prompted an early surge in car purchases. JD Power’s Thomas King noted that March results were “exceptionally strong,” as consumers rushed to buy. Hyundai achieved record sales, driven by high demand for the Tucson SUV and Elantra, marking a 10% quarterly increase. Kia, its sister brand, saw an 11% rise, led by the Sportage SUV and K4 sedan.

GM and Toyota Lead the Market

GM experienced strong demand in March, with Chevrolet Colorado sales up 73% and Chevrolet Traverse up 62%. Toyota grew 7.7% in March, though its annual increase was below 1%. Lexus sales rose 5.8% in March and 14% for the quarter. Ford’s retail sales increased by 5%, but total volume declined 1.3% due to fewer fleet sales.

Honda and Tesla Follow the Trend

Honda grew 5% in the quarter and 13% in March, with CR-V sales rising 9% and 24%, respectively. Tesla is set to release its global figures this Wednesday.

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Long-Term Tariff Effects

Manufacturers face 25% tariffs on imported vehicles, affecting nearly half the market. Even domestically assembled cars rely on foreign parts subject to levies. A study by Anderson Economic Group estimates production costs could rise by up to $12,000 per vehicle.

Buying Surge Before Price Hikes

The Chevrolet Trax, built in South Korea, saw a 57% sales increase but will face a 25% tariff starting April 3. The Chevy Blazer and Equinox EV, assembled in Mexico, could also be impacted. Dealerships have reported a surge in buyers fearing price hikes. Hyundai has warned retailers about potential record sales, while current inventory offers limited flexibility before tariffs take full effect.