Inspired by the food industry guy.
EDIT: Still around answering questions all day!
Most people don’t realize that even American built cars use a ton of imported components. One disruption can stall production, delay deliveries, or make vehicles even more unaffordable for some buyers.
I’ve been in and out of stores across the country and the impact is already starting to show. Ask me whatever; dealer reactions, supply chain issues, how this affects EV rollouts, or what it’s doing to incentives and pricing. I can even answer what really goes on in dealerships
Happy to break it down. AMA.
Comments
How are you personally preparing for this?
In the past, (as in 50 years ago+) were the auto supply chains primarily made up of US mfgs?
What would it take to establish those supply chains in the US today (gov. Investment, prolonged tariffs, etc)?
Do you foresee companies bearing some of the tariff cost? Or will 100% of the cost be passed to the customers?
What are your thoughts on how this will impact not just new car sales but also the used car market?
If the tariffs don’t stick around, do you think the price of vehicles will go down to pre-tariff pricing?
Which automaker will be hit the hardest by the tariffs? I was looking at a Subaru model that is made and assembled in Japan. I am not seeing any inventory locally in Northern California.
From a dealership perspective, don’t think this will be Covid 2.0? High margins, strong enough demand? Or because the tariffs will have a larger impact, the on consumer confidence, will we see it slow all together?
Wondering if dealerships will need to evaluate there other revenue models
It has been described as short term pain but the tariff will be beneficial in the long run. Do you agree with this?
Far less people NEED a new car compared to how many need food.
Albeit we live in an age of presenting “status” and people be buyin things.
I don’t think the automotive industry has much a leg to stand on as the food industry.
Post COVID interest rates and prices have held higher and people are already fed up with over inflated garbage built unreliable vehicles. Tariffs will just drive more people away, and maybe even prices down.
What do you think it’ll affect in Canada?
How do you think this will affect dealership technicians?
What is the timeline to build a domestic supply chain?
How many car companies will survive? What will be the hardest thing to re-source?
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Why aren’t you screaming to the morons in charge that this is a stupid stupid thing they’re doing? You all sound so measured and calm as if it’s , shrug, oh well.
New cars are soulless, software is awful, change might be a good thing.
If the tariffs were stopped tomorrow — how long would it take for everything to go back to normal?
Do you think these tariffs affect tesla the least by affecting other big 3 more and increasing their marketshare as a result?
Thanks. Any idea whether the big changes will relatively favor or disfavor EVs? Supply chain is more electronics less water pumps, transmissions, alternators, etc.
If AI will grab all and more of the new electricity, will that make EVs more expensive to drive especially with drill baby drill in place?
So uh, what really goes on in dealerships?
What’s a scam, what’s legit, what tricks to watch out for when buying, etc?
Edit: Whats a reasonable expectation when it comes to haggling price?
I have a relative who has a 2016 Elantra, 175k miles, still in good shape but hitting it’s maintenance markers (small oddities are popping up like the window freezing and not working unless we restart the car). They’ve been waffling about getting a new car for the last year. Do you think this is the time to buy? Or should they drive it until the wheels fall off and deal with it then?
How would the companies providing parts would be affected by this?
Would the waves of shock felt by the automotive companies would be echoed to those manufacturing car parts in a similar manner?(Turbochargers, seat belts, airbags, safety systems etc)
Pretty simple solution to corporate price gouging to insulate record profits folks…. Don’t buy their shit, buy less of their shit, and actively work to call them out on their shit. Fuck global trade, fuck every CEO and board member that operates with the “prices never come down” mentality. Prices will come down if people stop spending on their bullshit.
Do you feel the American car companies will be able to adapt to keep pace with China starting to dominate the world vehicle industry? We build vehicles for the American market and expect the world to buy our large inefficient vehicles for places they don’t work well in. I think that Bezos and the Slate are the way forward, cheaper, simple, and efficient.
Any talk about smoothing tariff costs across models no matter the actual cost. Some manufacturers are going to have a big problem that import and produce domestically. Mercedes for example is going to have a hard to justifying lower end models unless they push more of the Tariff cost onto higher end models that are not proportional to the actual cost to subsidize lower end stuff.
As a person who built Boeing aircraft in America, I understand. It Is ASSEMBLED in America, but definitely, a lot of stuff to assemble the components was from multiple other countries
Is now a good time to buy still, or is it already too late? Or should we just wait for 2 years for prices to come down? We just had a kid and while we don’t need a new car right this moment we probably would be looking at one in the next year or two anyway.
You say that “tariffs are about to change everything.”
The tariffs have been in effect for quite some time already. What is going to change, and on what timeline?
Is it that the supply chain is still working through pre-tariff inventory?
In the worst-case scenario, if tariffs escalate and demand for new vehicles plummets, with many consumers priced out, do you foresee dealerships gradually disappearing, allowing buyers to purchase directly from automakers?
Dealerships suck. From the car buying experience with the bullshit negotiating to hidden fees to shady upselling to service being prohibitively expensive, it just always feels like they’re trying to screw you. Why do the manufacturers allow these practices that make the entire industry look bad?
Here’s an idea. Pay your board and ceo less in salary / bonuses and make your shit in America again. Stop with the excuses of “components” blah blah blah. Y’all did it for 60 plus years before getting greedy and moving operations out of the country. Sucks right?
Ps not you personally of course 🙂
In your opinion, is it advantageous to purchase a new car now, if I’m looking to do so in the next 1-3 years anyway?
What about other regions? Will it influence prices of cars in Europe?
What’s the aftermarket parts industry going to look like? Also, will this drive further demand for used cars?
Even though Canada is not increasing tariff for the auto industry, do you think car prices can go higher there too? If so, why? I am referring to non-US made cars only, e.g. Toyota, Kia, Hyundai, BMW, etc.
What approximate percentage increases in car prices do you predict for different brands based on the tariffs? How soon will these increases happen on car lots?
(I know BMW was saying cars on the lot would keep pre-tariff pricing, but cars in production or transit would have higher tariff prices. However at that time the tariff plans had changed several times so everyone had whiplash and uncertainty).
I believe FCA/Stellantis has models they can built both in the US and in Europe, would they benefit from this by moving production to the US more easily. Or did they make the Chrysler more dependent of European parts, compared to Ford/GM?
Are we going to see an abundance of German luxery cars in Mexico and Canada now, if people starts dumping them?
So y’all knew this was going to happen. You know how I know that? Because I knew this was going to happen and I don’t work in your industry and I’m also an idiot. So you HAD to have known. So my question is two-fold:
I mean, I’m pretty sure the answer is “tax cuts” and “retribution”, but I’m interested to hear you rationalize it. Because it’s tough for me to imagine that you and the rest of your exec ilk are on our side. At all.
And yes, this post is super catty because fuck everything that’s going on and the people who enabled it. And I’m including you in that enabler group until proven wrong.
What happened to all that government money that was pissed away on electric vehicles? I believe only one company paid that back, Tesla. Correct me if I’m wrong.
Do you think the motorcycle industry (particularly JDM sport bikes) are proper fucked forever?
Well it worked last time. Why do you think it’ll be different this time. It is largely a synthetic problem. Last time the supply chains broke they actually broke. This time it’s more of a self-made issue
Do you think this will lead to cars with fewer of the useless “smart” features, such as phoning home with your private driving data against your will? Since most of the microcontrollers and all of the radio chips involved in this process comes from overseas and will now cost a lot more to implement.
So what’s the good news?
How do you see automakers positioned? Like are big 3 all in the same situation? What about Tesla? What about the Japanese?
Thanks a lot for the ama. Great insight
Do you think it’s suspicious Carvana reported a ~$7,000 GPU in their last earnings? Do you think this will hold throughout the year give pull forward in March & April boosted demand?
Is there an industry that deserves getting screwed more than the auto industry? Dealers specifically? Do you think after decades and decades of screwing customers, people should have sympathy? You outsourced everything to developing countries to have literal slaves make shit for you but that didn’t impact any actual prices here at home.
Just gave you better profit margins.
How much does a new car cost these days? Anyone tried to go buy one? How much do dealers screw people on a daily basis in the car buying process too?
And another question, after the massive bailout you all got from the U.S. taxpayers back in 2008, where you took our tax money and then continue to screw us all, I ask again, why should we have any sympathy for any of you?
Do you work for an OEM or a Tier 1?
I work for a Toyota dealer in fixed ops on the parts side and already have been getting asked tariff questions. I’m like for now we’re not effected price wise but no idea when it’ll take effect. Should I just prepare to ride the wave? Or any suggestions to stay or go?
Will China be a global power in the auto industry? And how will that affect US manufacturing? I imagine the US brands will be mostly limited to US market
What do you think of Chinese cars? I’m impressed with them. Can they take over outside the US and, ultimately, inside?
How much is 3D printing parts with the materials being invested towards to mitigate this 3rd+ party risk? Other engineering initiatives? ex AI/robotics? Asking as a perspective of you being the customer.
As a swe for one of the big three automakers, is my job safe?
Is there a potential that the current extra high tariffs on China will move manufacturing away from the USA? At least for portions of the supply chain that uses items mostly only available in China like electronics?
Lol if you want to know the truth Cash for clunkers an Obama program is what caused all the increase in car pricing by destroying the used car market as the turned in cars had to be scrapped lol If we had a robust used car market still then cars would be cheaper same strange how gov incentives next day boom prices raise by the same amount same with go green regulations duuuurh. Let the market decided what people want.
Im already anti dealership. Worked for one as a tech for years, flat rate is bullshit. Stealerships take advantage of their customers and employees.
So people won’t be able to afford new cars, meaning they will need to keep their old ones alive, leading to a parts shortage.
Do you think dealerships will finally die off? Can we finally start buying straight from the manufacturer?
Could this put an end to EV cars? That would be amazing
I guess I’m driving my current vehicle until the frame falls to pieces then. Getting it was already a ratchet because of the pandemic. I can’t wait to see what happens next. 💀
Do you have any advice for people that will inevitably be faced with a choice like mine, where they have to make the purchase while inflation/(tariffs) is high and inventory low? This is the US, after all. Cars aren’t optional for most of us, especially not with kids/dogs/etc.
Will teaching myself how to fix my vehicle myself help offset some of the rising cost? Not sure how much I can do myself but maybe I can at least change the oil.
I’m gonna ask the only question that has any importance to me whatsoever. What do you think the average mark up will be for vehicles? Will it vary greatly by make and/or model? If vehicles become notable expensive and sales dip, should we expect new extended payment plans, or just less car sales?
Howdy , what affect will a.i have on. This industry if nobody speaks about the prehistoric days I.e the days before the internet?
What’s happening to exports?
Tariffs aside (or perhaps catalyzed by tariffs), do you think the current dealership sales model will change?
I can’t wrap my head around why such an anti-consumer friction point is the norm. It should be no different than going to buy a pair of shoes.
Dealers having to take a haircut oh no…
There’s plenty to dislike about the tariffs but its effect on car dealers, after the bullshit they’ve pulled since Covid…ehh. It’s a “pigs get fed, hogs get slaughtered” situation for them as far as I’m concerned. That entire system is long overdue for a shakeup.
With Nissan already about to post a 5B+ red year, not just from sales but restructuring, impairment charges, and other reasons- are tariffs essentially a double whammy as far as trying to recover in the American market?
If the consumer mattered as much as the stock holders…where would prices be in the short term to help out until everything is realigned?
Our dealership is slooooooow. It feels like the phones are broken. No one is calling. No one is buying.
Would shifting to a no-dealer paradigm realistically lower the price of cars in the U.S. I’m aware that dealers would fight this tooth and nail, but on a very real timeline, direct manufacturer to purchaser businesses seem to have an advantage.
If the push for self-sufficiency is not now, then when? Wait until we are 100% reliant on foreign-made goods to make the move?
I can’t figure out from your responses who you work for because your knowledge base isn’t limited to one OE or even one brand family, but you seem to have purview over dealer operations and supply chain. Can you at least share the vertical (IE – OE like Ford, parts company like Mopar, parts dist like worldpac, or 3rd party like Aptiv?).
What about robotic plants? Can’t manufacturers just make robots do the jobs of people?
Oh, wait, that defeats the purpose of having Joe-Bob do the screwing in of those bolts.
Oh, wait… we would need to bud factories to build robotic arms first. Oh, wait, we would need chips for the robots from Taiwan 🇹🇼!
WE ARE REALLY SCREWED, but at least we are almost great again!
Will they raise prices of used cars, like what happened in 2021?
Did the prices on cars already increase due to tariff announcements?
Not a tariff question, but we need an affordable rear wheel drive, manual transmission, midsize American car. Preferably with a V8. Think Malibu, lemans, skylark.
Lol how many of these same posts
Are tariffs even still getting enforced?
It changes several times a day we don’t understand
Good. After seeing you guys let dealerships scam and hurt customers Im not at all suprised this is going to hurt.
For yeard you guys decided to outsource production overseas to make pennies on the dollar instead of investing back in the US
Let’s say ten years from now manufacturing somehow did get onshored to the USA. Would you expect it to provide lots of good (union) jobs, with living wages & good benefits? Or would it be more like one guy sitting under a light bulb watching a bunch of robots put cars together?
Interested to hear your take on autonomous driving. How long until true autonomous vehicles are on the roads and not just geofenced areas.
Will there be repair parts that just can’t be found but needed?
Which workers in the industry are most likely to experience layoffs?
Do you see mass layoffs across the board coming to the auto industry? I know it’s a different story with every company.
Um, I think most people with a brain understand that American made cars consist mainly of parts made outside the US. You’d have to live in a bubble to not have at least some level of knowledge regarding the origin of parts.
Do you think it is going to affect prices of parts for 1996 3.8 L mustangs?
How long before someone with serious influence, and a stake in the game, calls Peter Navarro and tells him to knock off the shit?
Who do dealers blame for this?
If your in the market to buy a car and you time period is like 1.5 year should you wait now or buy?
If someone wants to sign a lease for truck
what is the lowest offer they can get?
Can they do true zero down?
Can they write off any sign up expenses?
I’m not a numbers person or economic analyst. I’m not understanding how and why the DT administration is hiking all these tariffs and the taxpayer is the one suffering. I feel like there’s some underlying reason thIs administration is pulling these stunts. (And why doesn’t the public GET who tariffs are truly hurting? ) why is this administration doing this?
Why is the automotive industry so high in the political agenda? It’s a large industry, I get it, but not as strategic as others with higher margins and better benefits to the employees.
I just graduated from college with some automotive design work experience, specifically in drivetrain (through one of the SAE collegiatedesign series). If I wanted to get a job as an automotive design engineer, where would be the best place to go looking for job opportunities?
I have a leased car and I’m trying to get my dealership to buy it off me instead of turning it in. What should I do?
Superb AMA, with a combo of expertise, opinion and comprehensive answering of questions and follow up questions. Thank you!
Why do dealerships get legal protections to exist? What meaningful value add do I get for the money they extract from me. Why shouldn’t I be able to buy directly from the manufacturer?
Looking at investments, are dealerships more shielded because they work with used or will they be equally boned with tariffs?
Where are last years models that didn’t sell I am wondering why I can’t get my bmw thrown at me i am loyal customer
Yeh I would like a m140 asap before those v6 motors are never seen again tough to find one that’s not absolutely been thrashed nobody likes these new smaller motors
Will tariffs affect used car prices
Has the industry recovered from the chip shortage during the pandemic?
I once bought a brand new $36000 car for $24000. This tells me the dealerships and car companies have a whole lot of markup and have plenty to work with. I’m not losing sleep over tariffs.
Any idea how is Lucid motors positioned for tariffs?
Just another excuse for corporations to increase pricing and earn more record breaking profits and bonuses. But the day will come for ya crooked money thirsty a s hole s
Do you expect Japanese vehicles to skyrocket I ask because I have a 2023 with 5000 miles I am considering selling if that happens
Is it “late” to buy a new Toyota Highlander? Wondering if prices will go up or if inventory will be more limited in the next few months..
I don’t have a question, but I wanna say it’s amazing how quickly people forgot the car market during Covid. ADM was real and dealers were adding 30k to vehicles cause they could. If you really needed a car during Covid you had to pay. Covid caused manufacturers to delete options from vehicles and still charge MSRP+ I hope we aren’t heading back there but I won’t be surprised 1 bit if we do end up there again.
I recently got a used car like 1 year ago, maybe 2 at this point. A 2022 VW golf R, great car btw. Got it on finance.
For theory, would you say someone in my position should hold the car or flip/trade it in? Could be a used corvette or Camry or something else even.
Just wondering since you’re a legitimate exec, wonder what you would do as a consumer currently.
Who the fuck keeps buying these $90k+ vehicles I see all over the road? What do they do for a living besides loving debt and depreciation?
The new GMC truck looks sweet. At $92k they can kiss my ass. I’ll never pay that much for an EV truck. I need a truck for my hobbies and none of the EV ones are affordable. I already hate paying my $700 note on my 22 Chevy 1500 RST.