'Can’t afford that': Car dealer reveals how much your payment may jump under Trump tariffs

President Donald Trump's newly announced tariffs are already causing a strong reaction among American car dealerships, who warn that their new import duties are about to translate to higher prices for buyers.

David Auto Group President David Kelleher told CNN on Wednesday that monthly car payments could easily bounce almost $200 a month for buyers under Trump’s new tariffs on imports.

“That car could go from $30,000, ostensibly to 37,500, and it's that quick, and that kind of change in a price moves that payment $175 a month,” Kelleher told CNN reporter Danny Freeman. “Our customers, they're middle-class people. They just can't afford that kind of bump.”

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Freeman told anchor Jake Tapper that customers are already making split decisions on car purchases, whether or not they’re fully committed to the purchase.

“We met someone named Rosa Scott earlier today. She said that she came to this dealership … over the weekend, and it was packed. And while she was thinking about buying a new Jeep Wrangler, maybe in a couple of months, she told us once she … heard more news about the tariffs, she came back here today to pick up her car and buy it and drive it off the lot.”

Scott told Freeman she could not afford the purchase if the price climbed any higher, which forced her hand. It did not apparently matter that Trump’s tariffs allegedly target international sellers and Scott was buying an American-made vehicle.

“We're at a dealership right here that mostly sells American cars: Jeeps, Dodge Rams, Chryslers, and yet the owner of the dealership emphasized that these American cars will still be impacted … because some of the cars by these companies actually are straight imported from either Canada or Mexico.”

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American car companies like General Motors and Ford regularly take advantage of lower international wages and labor costs by outsourcing assembly to Mexico. General Motors’ Chevrolet Silverado, GMC Terrain, and Chevrolet Equinox are some examples, while Ford outsources assembly for the Maverick, Ford Bronco Sport, and Mustang Mach-E.

The vehicles themselves are not the whole picture, however.

“There are also the looming threats of tariffs on auto parts that are being imported as well,” said Freeman. “A lot of these Jeeps right here, they have auto parts from all over the world as well. So, that's also part of the challenge here and part of the risk to American cars.”

Experts told CNN that cars currently on lots “have already gotten past tariffs,” so there is time to make a purchase before tariff penalties hit. However, other sources warn that higher car prices in the immediate future mean higher insurance costs for pricier vehicles. Even vehicles sold in time to avoid Trump’s tariffs may not be immune to insurance hikes because insurance companies will be careful to factor in higher replacement costs for pre-tariff vehicles in the event the car gets “totaled” after a crash. And if the vehicle is not completely totaled, insurance companies will likely be making note of the increased price of replacement parts and adding that to customers’ monthly bill statements.

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