The price increase is the result of Trump’s tariffs on car imports that the car companies ultimately hand over to consumers for cars crashing into dealer lots in June.
The Ford Motor Company has increased the prices of three vehicles produced in Mexico and became one of the first major automakers to adjust sticker prices following President Donald Trump’s tariffs.
According to news agency Reuters, the new prices have been effective for vehicles produced after May 2nd.
According to a notification sent to dealers reviewed by Reuters, the price of the Mustang Mach-E electric SUV is one of the most affordable vehicles, with up to $2,000 on some models. A Ford spokesman said the car that increased priced would arrive at dealer lot in late June.
Ford said the trade war would add about $2.5 billion in 2025, but expects the revelations to fall about $1 billion. General Motors said last week that tariffs are expected to cost between $4 billion and $5 billion after heavily taxed foreign imports of cars, but was expected to offset that by at least 30%.
Trump’s tariffs unlock weeks of uncertainty across the auto sector as major US and European automakers drew forecasts, altered production and companies put plants in idle.
After weeks of pushbacks from the automotive industry, Trump eased tariffs on imports of foreign auto parts, providing automakers with credit for what is being produced in the US, and avoiding the double tension of the raw materials used in production. However, the White House has not withdrawn its 25% tariff on the 8 million vehicles that the US imports each year.
Ford is in a better position than some of its competitors because of its strong manufacturing bases in the US. According to a Barclays analyst memo, automakers in Dearborn, Michigan assemble 79% of U.S. vehicles sold domestically, compared to 53% of GM.
Price pressure
Ford and GM are facing serious taxation on imports from China and South Korea, respectively. GM estimated that the cost of imports from South Korea totaled around $2 billion, and Ford refused to designate costs for importing vehicles from China.
Automakers relying on exports to the US face increasing price pressures. According to 2024 data from S&P Global Mobility, 12 major automakers, including Toyota and GM, import at least 40% of the vehicles they sell in the US, and more than 60%.
Before Ford’s move, most automakers hadn’t taken the first step to raise prices, but warned that it was on the way. Porsche said it would have to increase sales costs if tariffs remain, but the US Volkswagen Audi brand suggests a potential price increase without providing details.
In contrast, BMW hopes that US auto rates will fall from July based on contact with US officials. This is a brighter rating of the trade environment than many of its rivals. GM’s finance director Paul Jacobson told analysts last week that the automakers are not expecting an imminent price rise, saying, “It feels good about where today’s pricing environment is.”