Brian Lehrer: A Daily Politics Podcast Why GM Is Eating Its Billion Dollar Tariff Costs (For Now)
Jul 28, 2025
Alexandra Svokos, digital managing editor of Kiplinger, dives into the financial ramifications of tariffs on the auto industry. She reveals how General Motors is absorbing a staggering $1.1 billion loss yet choosing not to raise prices. The discussion also touches on the complexities of trade negotiations and their ripple effects on other sectors, like beauty products. Svokos analyzes the new U.S.-EU tariff deal and what it means for future pricing and manufacturing strategies, highlighting the delicate balance in global trade.
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GM's Billion Dollar Tariff Impact
- GM reported a $1.1 billion quarterly tariff cost due to a 25% tariff imposed on imported cars and parts.
- This cost trend affects all car manufacturers worldwide because cars rely on globally sourced parts.
Holding Off Price Increases
- Many companies, including GM, avoid raising prices immediately despite higher costs from tariffs.
- They hope tariffs will be reduced or negotiated before passing costs to consumers, avoiding loss of customers.
Car Price Hikes Expected Soon
- Experts expect car prices to rise 4-8% eventually due to tariffs.
- Timing is uncertain as negotiations and trade deals are still underway.