Well, not a lot has happened in the past week regarding tariffs. I want to say that no news is good news, but I am not sure that applies here. Here are some new things we’ve learned this week:
Ford has said it could raise prices starting in June. That is when the current Employee Pricing program ends. In the past, the Blue Oval automaker stated they would not raise prices during the timeframe of its From America-For America promotion. Lincoln has also held the line on the Nautilus SUV, which is built in China and imported to the U.S. but haven’t committed to a specific timeframe.
Audi, Land Rover, and Mitsubishi are quickly running out of room at U.S. ports in America. The cars are coming into the country, but being stacked up, and the pile is getting higher. You might be wondering what the point of that is? The tariffs are not imposed until the vehicle is processed and shipped out of the ports they arrived in. So, if the President were to settle with the origin country of overseas automakers, the vehicles could be quickly shipped tariff-free. It will be interesting to see how much space the car companies can find to store a whole lot of inventory.
Volkswagen has committed not to raise prices until June. You might recall we reported to you that VW was planning to add a surcharge to the window sticker of new cars, and they will likely still do that, but at least now we have a timeframe. They had originally sounded like raising prices was imminent.
Meanwhile, Honda has committed to moving production of the popular Civic hybrid from Japan to the United States. The automaker will shift production to its Indiana facilities, where they have room for added production, avoiding the tariffs.
In sort of a reversal from what we’ve seen, Tesla is not accepting orders from customers in China. Tesla builds 100% of the vehicles they offer in the U.S. The Chinese have aggressively upped tariffs each time the President raises them. Tesla has not said when they would resume taking orders from China, but it is likely they won’t commence until the trade war has ended.
File photo of Honda Manufacturing of Indiana. Credit: Honda.
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