Some automakers have already raised prices or fees to help offset some of the costs associated with the Trump administration’s tariffs. The latest? Volkswagen is raising prices on most 2026 models.
Trump’s tariffs were expected to raise prices on new vehicles when implemented earlier this year. The increases have been minimal — until now.
It’s the second time this year VW’s increased prices, although these new hikes apply to 2026 model year vehicles. These latest jumps range from 2.9% to 6.5%, and cover the Jetta, Taos, Golf GTI and Golf R, Atlas and Atlas Cross Sport. New pricing hasn’t been released for either the company’s bestseller, the Tiguan, or its two electric vehicles, the ID.4 and ID. Buzz.
VW’s not alone. Earlier this year, Ford revealed increases in May on the Ford Bronco Sport, Mustang Mach-E and Maverick — all built in Mexico. The increases were as high as an additional $2,000. Others have been tweaking prices as well. However, according to Edmunds.com, the manufacturer’s suggested retail price increased less than 1% between March and August.
New car prices
It’s important to know that the average stick price last month rose 3.3%, according to Cox Automotive, but that’s when new model year vehicles begin to arrive, and that jump was on par with previous years’ increases.
When tariffs with Mexico, Canada, Japan, China and the European Union were announced at various points throughout the year, plenty of experts offered up predictions of price increases ranging from $3,000 to $10,000 per vehicle, depending upon what kind of car and where it came from.
There’s been a massive drop in shipments of European and Asian vehicles since Trump’s tariffs went into effect.
However, as noted, it hasn’t happened. Automakers have largely been eating the costs, hoping that President Donald Trump would repeal the levies. However, now that they appear to be sticking around, automakers have to decide just how much are they willing to take — in losses.
Big numbers
It’s not an insignificant number for most automakers. GM’s predicted as much as $5 billion in losses while Ford is only slightly better off, officials forecasting a $3 billion hit. Other automakers, especially foreign brands that rely heavily on imports from their home countries are facing a difficult landscape.
“Our priority remains ensuring that we’re competitive through affordability,” Hyundai North America CEO Randy Parker told Reuters. The company held the line on pricing, losing about $600 million in the second quarter.
The numbers only continue to grow.
Erin Keating, executive analyst with Kelley Blue Book parent company Cox Automotive, notes, “Based on volumes and average listing prices of imported vehicles through the first seven months of 2025, automakers have theoretically racked up more than $25 billion in tariff obligations so far (if tariffs were in place from Jan. 1). This is equal to the average imported vehicle being charged roughly $5,200 at the U.S. border.”
More Tariff News
- Budget Buyers Likely to be Hard Hit by Tariffs
- Trump Gives Some Tariff Relief to Automakers
- Automakers Find Ways to Offset Tariffs
When is the hit coming
Even American-made vehicles are facing higher production costs due to tariffs.
That’s a good question, and the answer is arrived at more by art than science — largely because it’s a matter of just how long executives at each automaker feel like they can hold out. Tariffs added between $2,300 and $2,500 to each vehicle in the U.S., according to multiple estimates.
“Automakers and dealers are containing the higher costs created by tariffs while watching profitability decline,” Keating noted in a release. “That won’t last. The Cox Automotive team still expects consumers to see retail prices climb by 4–8% by year-end, with price increases accelerating as 2026 model-year vehicles hit the market.”
Others share this view. Industry consultant Warren Browne, a one-time GM executive, told Reuters he believes prices will rise starting this fall to maintain their profits. However, the rising prices are expected to act like a wet blanket, cooling off new vehicle demand.
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