Recently our Operations Manager, Ron Kubota, was interviewed by multiple local news stations about how new auto tariffs imposed by the current administration could affect prices in the used car market. We’ve already seen price turbulence in recent years, as addressed in a previous post here, and these new business conditions are just the latest factor to affect the cost of automobiles in the United State.
Watch & Read – Ron’s interview and news article from NBC’s Channel 5 affiliate KOBI and ABC’s Channel 12 affiliate KDRV (both based in Medford, Oregon) are included below.
Watch, from KOBI Channel 5:
Read the full story from KOBI’s Kade Sterling:
“25% auto tariffs take effect April 2; will drive up nearly all auto costs”
From KDRV Channel 12’s Rocky Walker:
“It’s going to affect the whole industry: Local businesses respond to car tariffs“
Starting April 3, foreign cars and car parts will see a 25% tariff enacted by President Donald Trump Wednesday. The move is expected to have significant effects on the car industry, with experts and industry insiders expressing concern over its long-term impact on prices and supply chains.
Local businesses in the car industry, including dealerships and mechanics, are already feeling the pressure from rising costs.
Ron Kubota, operations manager for World Famous Autos, a used car dealership, said the tariffs will affect every aspect of the industry.
“New car prices will go up, and as a function of that, used car prices are going to go up,” Kubota explained.
He noted that the ongoing price increases of the pandemic have already stretched sellers’ margins to their limits, and the new tariff will make it even harder to absorb the cost increases.
“We’re just going to have to pass it onto the consumer like anything else,” he added. “We can’t lose money to sell a car.”
Mark Fulton, the owner of Medford Auto Care Center, echoed similar concerns, saying that the margins for local mechanics are already too thin to absorb additional price hikes.
“I’m not going to take that hit,” Fulton said. “Trying to keep my door open, because if I’m selling parts at cost, that doesn’t make any sense.”
Another challenge raised by industry professionals is the impact of the tariff on supply chains, which are still recovering from the disruptions caused by the pandemic.
“The supply chain means the stuff’s going to take longer to get and be more expensive,” Kubota warned. “If we don’t get the part, we can’t fix it.”
Kubota believes the tariff is a senseless move that will only increase costs for consumers. While Fulton hopes it will encourage more car production in the United States.
“ You look at the boxes and the packaging and it says, ‘made in China or made in Mexico or Canada.’ Well, why don’t we make them here? You know, let’s keep it in-house.” Fulton said.
Despite differing opinions on the long-term effects, one thing became clear in the conversations: car prices are likely to go up in the near future.
