Trump's tariffs are costing US car buyers even more than previously thought

US car buyers are set to feel the full force of Donald Trump’s tariffs, which consultants AlixPartners warn could push up the price of vehicles by as much as $2,000.

According to AlixPartners, the majority of the burden from Trump’s tariffs is likely to be passed directly onto consumers, with auto manufacturers expected to add around 80 per cent of the additional costs to vehicle prices. This translates to an estimated increase of approximately $1,760 per car.

Beyond the immediate impact on prices, the consultants also raised concerns over the administration’s stance on electric vehicles, warning that restrictive policies could push American carmakers to the sidelines in the rapidly expanding global EV market.

Mark Wakefield, global auto market lead for AlixPartners, shared with reporters, "These tariffs bring a big wall of cost," with “consumers taking the majority of the hit.”

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This year, tariffs are set to take a hefty toll on the big American automakers, with General Motors facing an estimated $5 billion hit and Ford expecting costs close to $2.5 billion.

Wakefield predicts that rising prices could cut US vehicle sales by around 1 million over the next three years. However, as tariffs ease, he expects sales to climb to 17 million by 2030 – up by a million from last year.

Wakefield says the tariff wall "is not likely to last forever," but the bigger issue is the government cutting incentives for electric vehicles, like the $7,500 tax credit.

Without these, buyers are likely to stick with traditional petrol cars to save money. As a result, AlixPartners has nearly halved its forecast for US EV sales in 2030, now expecting them to make up just 17 per cent of the market, down from 31 per cent.

Meanwhile, petrol cars are expected to rise to 50 per cent of sales, and hybrids to 27 per cent. This shift could weaken US automakers, forcing them to rely on China for EV technology.

Wakefield warns that American carmakers might become known for making powerful V8 engines — a technology rapidly becoming outdated — rather than leading in electric vehicles.

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