New Import Tariffs on Autos

If the administration will apply the 25% import duty on cars, this will spell troubles for the US Consumer and for the Automakers that are not assembling in the USA.

As you can see from the chart below, the duties that may be levied on Autos and Auto Parts will be bigger that the duties levied on Aluminum, Steel and China combined.

One important info is that America is the biggest importer of cars worldwide. During the year 2017 cars made up 41% of the total goods export of Japan and 14% of EU's.

Some automakers, like Ford, GM, Honda will then have a big advantage because they assembly cars in the US. Others, like Toyota, Mazda, BMW and Mercedes will be heavily impacted by the duties.

We will then have to see if the price of new cars will go up as a consequence or if automakers will absorb the increase.

All in all, new auto sales keep on softening and they may continue to do so the more Interest Rates go up. Today's new vehicle sales YoY was below the 17M mark as you can see from the chart below