Car Prices Are Poised for $12,000 Surge on Trump’s New Tariffs
Mar 3, 2025
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In this discussion, stacy-marie ishmael, Bloomberg's Crypto Managing Editor, shares insights on market skepticism regarding Trump's plan to include lesser-known digital tokens in a U.S. reserve. Alexis Browne Roberts, COO at Alexis Investment Partners, weighs in on emerging market trends amid the new tariffs expected to raise U.S. car prices by as much as $12,000. Together, they explore the ripple effects of these economic shifts on consumers and investors, emphasizing the importance of adaptability in a volatile market.
Impending tariffs on car imports from Canada and Mexico could raise U.S. car prices by up to $12,000, disrupting the automotive supply chain.
Skepticism surrounding President Trump's proposed crypto reserve is causing market volatility, particularly affecting major cryptocurrencies like Bitcoin and Ethereum.
Deep dives
Impact of Tariffs on Auto Prices
Upcoming tariffs on vehicles manufactured in Canada and Mexico are expected to significantly increase car prices in the U.S. Estimates suggest that prices for electric vehicles could rise by as much as $12,000, with other vehicle types seeing increases ranging from $4,000 for crossovers to $9,000 for large SUVs. Automakers that rely heavily on parts or assembly from these countries will bear the brunt of the tariffs, disrupting the established North American supply chain. Companies like Ford and General Motors, which produce parts in Canada and Mexico, may see model offerings shrink as a result, affecting their sales volumes.
Diverse Reactions from Automakers
Different automakers are reacting variously to the impending tariffs, with Tesla potentially less affected as it produces most of its vehicles in the U.S. However, even Tesla's stock suffered after the tariff announcement, revealing a broad market concern. Some automakers may pause production of certain popular models made in Mexico, while others, like General Motors, are working on centralizing their production in the U.S. The uncertain nature of the tariffs leads many companies to prepare for various outcomes, indicating a climate of tension and a potential slowdown in new vehicle offerings.
Market Reactions to Crypto Developments
Recent announcements regarding the U.S. government's strategic crypto reserve have caused significant volatility in the markets, particularly affecting Bitcoin and other digital assets. The skepticism surrounding President Trump's proposed crypto reserve, lacking clear details about its creation or funding, has led to a downturn in prices for major cryptocurrencies like Ethereum and Bitcoin. Investors have expressed concerns about the government's potential involvement in the crypto space, questioning its validity in addressing issues like inflation and financial security. The uncertainty around crypto regulations combined with global economic tensions has create a high-risk environment for crypto investors.
Broader Economic Context Ahead
Economic indicators suggest that leveraging cryptocurrencies within a strategic reserve is fraught with challenges and public skepticism. While some proponents argue that holding Bitcoin could protect against inflation, critics point out the volatility and unpredictability associated with digital currencies. The desire to establish the U.S. as a leader in the financial technology sector comes into conflict with public trust and understanding of these assets and their implications. As economic conditions evolve and markets shift, the effectiveness of such proposals will hinge on widespread communication and the establishment of trust between regulators and the public.
Watch Carol and Tim LIVE every day on YouTube: http://bit.ly/3vTiACF. Bloomberg News Auto Reporter Keith Naughton explains how impending tariffs on Canada and Mexico may increase US car prices by up to $12,000, squeezing consumers and disrupting automotive supply lines. Bloomberg News Managing Editor for Crypto stacy-marie ishmael discusses President Trump's announcement that the US will include three lesser-known digital tokens in its strategic crypto reserve, which was greeted with skepticism in the industry as investors question the project’s merits with Adam Sullivan, CEO of Core Scientific. And we Drive to the Close with Alexis Browne Roberts, COO at Alexis Investment Partners. Hosts: Carol Massar and Tim Stenovec. Producer: Paul Brennan.