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Trump Tariffs May Cost Carmakers 1 Million Auto Sales a Year

  • Levy threat should be taken seriously, LMC Automotive says
  • Passing along full cost may compromise 2 million units a year
Bayerische Motoren Werke AG Mini vehicles are displayed for sale at a car dealership in Louisville, Kentucky.

Bayerische Motoren Werke AG Mini vehicles are displayed for sale at a car dealership in Louisville, Kentucky.

Photographer: Luke Sharrett/Bloomberg
Updated on

If President Donald Trump slaps a 25 percent tariff on imported vehicles, it may cost the U.S. auto industry 1 million annual vehicle sales -- and that’s just the low end of the estimated damage.

The projection by researcher LMC Automotive assumes automakers would absorb at least half the cost of a tax on imported vehicles, said Jeff Schuster, senior vice president of forecasting. If companies pass the full 25 percent cost on to consumers, it could snuff out about 2 million sales, or more than 10 percent of annual U.S. deliveries, he said.