The Donald Trump administration is expected to impose a 25% tariff on imported vehicles starting at midnight on May 3, local time, as U.S. consumers rushed to purchase cars before the tariff is enacted, leading to double-digit growth in sales for automakers such as General Motors and Hyundai in the first quarter of 2025, according to reports on June 1 by The Washington Post (WP) and CNN.
Sales of Hyundai and Kia in the U.S. for the first quarter of 2025 increased 13% compared to the same period last year. Among these, Hyundai's sales surged 68% in the first quarter, and sales of hybrid cars rose 72% in March alone. Sales of the Kia Carnival, produced in Malaysia, also increased 53% in the first quarter compared to the previous year. According to The New York Times (NYT), Randy Parker, CEO of Hyundai Motor America, noted in a letter sent to reporters on June 1 that "the past weekend was the best I have seen in a long time."
US
General Motors also saw a 17% increase in sales in the first quarter of 2025 compared to the same period last year. Sales for Honda and Nissan also rose by more than 5%. However, Toyota's sales grew by only 1% compared to the previous year, and Ford's sales fell by 1.3% due to the discontinuation of its Edge SUV, although March sales saw a 19% increase compared to the previous year.
The automotive industry expects that if a tariff is imposed on imported vehicles, automakers will raise car prices, passing the burden of the tariff onto consumers. Given that about half of the cars sold in the U.S. last year were imported, it appears that consumers are purchasing vehicles ahead of the tariff implementation.
The Trump administration is also expected to impose tariffs on imported auto parts on May 3, prompting assessments that price increases for vehicles assembled in the U.S. are unavoidable. Cars produced in American factories typically include components manufactured overseas, often exceeding 50% of the car's value. NYT predicted that "automakers will need to raise the prices of some vehicles by more than $10,000 (about 14.72 million won) to mitigate the burden of the tariff."