Price increase from tariffs on automotive industry?

  1. TXRyan

    TXRyan New Member

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    Hey – first time posting, but I’ve been reading while I’m debating buying a 2018 or waiting for the 2019MY. I’m curious as to what everyone’s thoughts are regarding the potential for tariffs and their effect on prices. I’m not sure on the percentage of foreign parts on a wrangler, but I imagine there’s some. Would this change anyone’s purchase timing? Even if there is a low number of parts effected by a tariff if seems like FCA might want to capitalize on the higher price of competitor vehicles and increase the price regardless.
     
  2. The_Phew

    The_Phew Well-Known Member

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    #2 Jul 19, 2018
    Last edited: Jul 19, 2018
    The tariffs are going to hit EVERY automaker hard, and the Wrangler won't be spared. Raw materials (steel/AL) costs have already gone up uniformly (FCA passed those on with a price hike earlier this year), and many of the other parts will be hit by these tariffs. The only question is will FCA eat those costs, or raise prices. I expect it'll be a mix of both.

    My wife works for a large consumer products company, and their response to the tariffs has been to cut U.S. manufacturing jobs and move more production to Asia, to defray the overall cost impact. I doubt that was the intended effect, but Cheeto von Tweeto was never known for his understanding of global economics.
     
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  3. Rockreid

    Rockreid Well-Known Member

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    All of the 2019 models I’ve read about across the industry and getting anywhere from a $500 to $2000 price increase depending on how high the sticker price already is. The Ford Fusion is getting a huge price increase in its top trim level..probably apples to bananas. But anyway we have yet to see the real impacts of tariffs because most haven’t even been implemented yet in full force. If all of the worldwide tariff threats become reality then we are in for some serious sticker shock across the board on store shelves and car dealers. There is no way manufacturers are going simply eat all of the extra costs involved in manufacturing.
     
  4. crazychile

    crazychile Well-Known Member

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    It's almost always better to buy now. Your dollar today is always worth more than the same dollar in the future due to inflation and interest rates that usually trend upward until a peak, crash, rebuild period.

    Tariffs are a temporary corrective action. Prices may increase due to tariffs in the short term, but will eventually stabilize, all other things remaining equal. If manufacturing jobs return in significant numbers, this will increase revenue and wages more than enough to offset price increases. Right now is the painful period because people want to focus on the short term before the rebuilding and market stabilization is realized.
     
  5. Litfuse

    Litfuse Well-Known Member

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    Used car prices are going to hold strong, that is for sure.
     
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