Experts speak on potential impact of tariffs on automotive industry

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EAU CLAIRE, Wis. (WEAU) – President Trump has circled April 2 as the date he may call for up to a 25% tariff on imports.

One industry bracing for impact is the auto industry. A local expert says the auto industry may not be the only one effected.

Department Chair of Economics at UW-Eau Claire, Dr. Thomas Kemp, explains.

“It’s hard to know exactly which industries would be impacted, because many industries buys from other industries. The automotive industry buys plastics, buys rubbers, buys electronic components, it buys a variety of things from other industries, so if those things get tariffed, of course those costs get kicked down stream into other industries.” he said.

And if tariffs are put into effect, prices could fluctuate.

“When prices go up people buy less of a thing.” Dr. Kemp said.

With the economic concerns in pricing, another one is in job opportunities.

“The extend that we’re exporting goods and services & there’s reciprocal tariffs, so if other countries tariff us, so that means there’ll be less demand for those use and services which leads to potentially less jobs.” he said.

The Trump Administration saying these tariffs will give more jobs to the American people.

Dan Mattoon, a car dealer at Prestige Auto, explains.

“I can’t predict that either, but certainly the intent is that eventually we get all of the cars manufactured here in America, as many as we can, if not then they’re going to get hit with a tariff. Do I think that’s a good thing, I do. Because it’ll bring more American jobs, more manufacturing here in the United States.” he said.

Mattoon says a lot of cars can be built in America, but to be exempt from a tariff they have to have at least 70% of parts from America as well.

“Actually more import parts, a lot of the percentage on import cars are more American made that most of the American cars like Chevy, GM, Ford.” he said.

However, if car prices increase, it sparks concern in buying both old and used cars.

“The value of used cars are going to go up as well. So with that said again, I think there will be a buying frenzy in the market over the next 30-60 days.” Mattoon said.