Chicago car dealerships, repair shops brace for Trump's tariffs on imported vehicles and auto parts
With a 25% tariff on vehicles and auto parts imported into the U.S. going into effect next week, it could soon cost you more not just to buy a car, but to get one fixed.
The average price of a new car in U.S. was about $49,000 as of Thursday, but the new tariffs are expected to drive that price up.
Chicago area car dealerships will have to adjust, and so will auto body shops.
No business survives 91 years without a rough patch. Jay Gottfred manages the Erie-LaSalle Body Shop in the West Town neighborhood; a business his grandfather started in 1934.
"Constantly evolving industry. Always gotta keep up," he said. "Lot of old characters there, that's for sure."
The road ahead is about to get rougher for the family business.
"I know parts will be going up. I'm not sure to what degree yet. A lot of unknowns here," Gottfred said.
The new tariffs announced by Trump are set to take effect on April 2. The White House expects to raise $100 billion in revenue and boost manufacturing in the U.S.
But Gottfred expects the costs of tariffs to trickle down to consumers.
"The cost of repair is going to go up, which means the premiums are going to probably start going up for the consumers as well. So, obviously, it's a snowball effect for all these things," he said.
Joe McMahon, executive director of the Illinois Automobile Dealers Association, expects car prices to rise as well.
"When you attack the auto industry, and you put 25% on that, that's instantly going to drive people out of the market. They're going to hold their vehicles until the tariffs are gone," he said.
At the body shop Gottfred is already dealing with a 10% price hike on materials tied to tariffs.
"A lot of parts like abrasives, adhesives, sealers – things like that," he said.
This rough patch is out of his control, but he said the family business will ride through it.
One estimate from the Anderson Economic Group – a Michigan-based financial consultancy firm - said prices could go up by $4,000 to $10,000 for most vehicles, and up to $12,000 for electric vehicles.
Dealerships expect this weekend could be a busy one for people who want to buy a car before tariffs go into effect.
