Hyundai and Kia are the first to report their quarterly sales in the United States, and — shocker — people suddenly got very interested in buying cars in the last few weeks of the quarter. A kind of clever thing to do if you were the President would be to get everyone worked up about tariffs, get a strong quarter of sales, and then say “never mind.” That’s probably not going to happen.
Today we celebrate three years of making this website, and I know that many of you come to The Autopian specifically to get away from the concerning news of the world. Trying not to write about the tariffs or their impacts is mostly impossible, so for today’s Morning Dump I’m going to focus less on the politics of it and more on the practical considerations of it all.
For automakers, in the very short-term, it’s probably going to mean more sales. After that, it’s anyone’s guess, but automakers are worried about it enough that they’re engaging in all sorts of interesting behavior. There’s the bargaining phase, which is where most automakers are. And there’s acceptance, which means trying to import all the cars you can while you can.
Finally, for all the talk about Tesla’s share price, one of its newest competitors in China is seeing a huge dip over safety concerns.
Hyundai And Kia Cash In This March As People May Be Trying To ‘Lock In The Price’
Last night the mighty Longhorns vanquished TCU to enter the college basketball Final Four as March Madness spills over into April. The same madness seems to be infecting car buyers, at least at Hyundai and Kia dealerships. Hyundai had its best-ever quarter, with 203,554 sales, up 10% year-over-year.
More impressive for Hyundai, the company’s March sales hit 87,019, up 13% year-over-year. That March number is the second-best month in the company’s history. Hybrid sales led the charge, up 68% year-over-year, with only one EV (the Ioniq 5) in the black this year, though up strongly at 26%. The biggest drops were for the Kona, which has an EV version, and the Santa Cruz, which is great but expensive.
Kia’s total sales were not far off at 198,850 units, a 10.7% quarter-over-quarter increase. The company’s March was also the biggest March on record, likely led by hybrids, and positive momentum for the Telluride and Carnival. The EV6 and EV9 were both down year-over-year.
What does this mean? Hyundai and Kia both build a bunch of extremely competitive products. The company has gotten a bunch of good press for expanding in the United States, even if most of those plans existed before the tariffs were announced.
Some of this, though, is probably a tariff effect, as Automotive News reports:
“The final week of March was the strongest retail sales week we’ve seen of the year,” said Eric Watson, vice president of sales operations at Kia America. “Part of it may have been driven by customers trying to lock in the price of a vehicle they want to purchase.”
Watson said showroom activity was also strong across the industry in the closing days of March.
Definitely lock in the price while you can. I don’t know what is going to happen, but I know that prices now are probably decent. I will continue to tap the “buy your next car before the trade war starts” sign until my finger falls off. Because I bought a car last year (from Galpin Honda, which is owned and operated by Autopian co-founder Beau Boeckmann), I got this email that was sent out to all customers that I thought was interesting:
With the recent announcement of the upcoming 25% tariffs for vehicles and parts built outside of the United States, one thing is certain, our current inventory of nearly 3000 new vehicles is unaffected and tariff-free! The silver lining is that your trade-in is potentially worth significantly more today. Rest assured, Galpin is here offering you the great Galpin deals as we have for over 75 years.
If you have been thinking about a new vehicle, now or in the future, now may be the time. Even if you haven’t been thinking about one, it might make sense for you to act sooner than later. It’s possible that if the tariffs go into effect April 3rd, prices could very well go up from the manufacturers, and in some cases, significantly.
It is also important to point out that since the 25% tariffs applies to parts and components, every vehicle will be affected, even those built in America, as every vehicle has parts and components that are imported.
It’ll be interesting to see how much of a car-rush, if any, we see in the coming weeks at dealerships around the country.
Automakers Are Asking For A Break, Telling Employees It’ll Be Fine
I have not talked to a single person who thinks that tariffs aren’t going to cause car prices to go up. Maybe you think prices should go up. Maybe you think cars are too cheap, and that the cost of those cheap cars is a loss of American manufacturing. I am open to the argument, which is similar to what the UAW is currently saying.
The auto industry, reportedly, isn’t entirely on board. There’s some reporting out there today that the industry is fervently lobbying to make this not happen this week. Let’s start with Bloomberg, which is out this morning with “US Automakers Make Mad Dash to Push Trump to Temper Tariffs” and these details:
Detroit’s automakers have conceded that they’re willing to pay tariffs on completed cars and large components like engines and transmissions, the people familiar with the matter said. But representatives for the companies have told the administration that levies on parts would drive up costs by billions of dollars, leading to layoffs and profit warnings that would run counter to Trump’s goal of building up the industry, one of the people said.
Representatives for the companies declined to comment. Trump on Monday declined to say whether the administration is considering exempting some car parts from the tariffs. He said he had already given automakers “a break” by pushing off tariffs for a month.
The US companies are seeking exemptions on low-value parts like sheaths of electrical wiring that course through modern cars, which are labor intensive to produce and tend to be made in Mexico and other low-wage countries. They argue that the combined levies would send car prices soaring and depress demand from American consumers, who are already confronting average prices approaching $50,000.
Over at the Detroit Free Press, we have the message that automakers are sending to employees:
Leadership at General Motors and Ford Motor Co. are reassuring employees and investors that the companies are working on how to best navigate the turbulence they foresee coming out of the 25% tariffs President Donald Trump imposed on all imported autos and most auto parts.
The messages to the workforces at both automakers, obtained by the Detroit Free Press, said companies are well-positioned to address the uncertainty around the tariffs, which take effect Thursday. Despite being healthy companies, both automakers will feel impact, the statements said.
For that reason, company leaders are wasting no time in studying the new executive order and advising employees to stay focused on their jobs and be mindful of corporate spending.
The annual holiday parties might be a little more muted this year if this holds.
Mercedes Is Reportedly Stockpiling While They Can
Both Mercedes and BMW keep stockpiles of imported cars in New Jersey, and it seems like those lots are a little fuller than usual. Every time I drive by, there seem to be more new vehicles. This apparently isn’t just my imagination, as Reuters is reporting that Mercedes is stockpiling in advance of tariffs.
Mercedes-Benz is building up inventory levels in the U.S. at the wholesale level and at dealer lots to get ahead of tariffs due to be collected from April 3, executives told analysts on a call, according to notes by analysts.
Asked about pricing, executives said no automaker was operating in a silo, implying it would observe how its competitors responded once tariffs were in place, the note by Bernstein Research said.
Mercedes did not immediately respond to a request for comment. The investor call was held before a closed period on company information before annual results scheduled for April 30.
Hear me out, Mercedes. Let’s make a movie where you give me an Actros hauler full of AMGs and a Project.ONE and I’ve gotta Smokey and the Bandit it across the border by April 3rd.
Xiaomi Faces Its First Crisis
The most interesting automaker in the world right now, besides Škoda, is clearly China’s Xiaomi. The smartphone company managed to skip a bunch of steps to become the most talked-about EV automaker in China, even if it’s not even close to the biggest.
A fatal crash that may have involved people trapped in a car has hit the company’s share price, according to local media. Here’s the take from the South China Morning Post, which notes that the company’s assisted driving system was being used:
Xiaomi said the car was travelling at 116kph on a highway with the driver assistance system in operating mode, adding that the system alerted the driver to take over the vehicle two seconds before it hit a concrete barrier.
While Xiaomi did not mention the number of fatalities involved, the mother of the driver said in a social media post that three people – the driver and two passengers – died in the crash.
Xiaomi, which found success with the SU7, did not say if it would recall the cars or update the self-driving software.
Other reports iindicate the three passengers may have been trapped in the car after the crash, although a lot isn’t known at this point. While there have been other incidents with the SU7, this is the first time I can think of that Xiaomi has faced this kind of serious scrutiny.
What I’m Listening To While Writing TMD
Hey, it’s our third birthday. If you love the site and support us by being a member, thank you! If you’re not a member and would like to become one, click this link to save 13.33% on any annual membership, or go here and use the code threeisamagicnumber. In the meantime, please enjoy De La Soul’s “The Magic Number.”
The Big Question
Are you more or less encouraged to buy a new car right now?
Top photo: Depositphotos.com
The best thing we will likely get out of the tariffs and subsequent price hikes are decontented vehicles at more realistic price points.
How many vehicles can you even buy today without a LCD bolted to the dash that controls way too many things in the vehicle? Here’s hoping we can get back to simpler cars that aren’t trying to be your cell phone, personal computer, entertainment system, and chauffer all at once. Entry level cars are a necessity, think the old chevy caviler’s, dodge neon’s, and ford foci. Regular small cars that are so cheap they’re still worth the pricetag.
I’m sitting pretty in a ’17 Accord with 62K (miles) on the clock. It may well outlive me.
I’m more worried about my IRA and its exposure to stock market fluctuations than what it might cost me (and my 88-year-old mom’s) to buy a new car, that I likely won’t have to.
The big question is not about buying a car. The big question is; what will the car companies do about tariffs? Which is, nothing. They didn’t do anything before, they wont do anything now. All they know is charging more, when that stops working, they fold like a busted flush.
Late to the thread but we jumped on a new lease over the weekend. Our family is growing again this summer so we were going to be upgrading anyway, so we just moved the time table up. There’s nothing out there we love so we’re leasing again.
I’m banking on one of 3 scenarios:
1) Tariffs wreck the auto industry, used cars skyrocket, and our lease ends with equity for us to buy it out like we did our Countryman S after COVID.
2) We end up not caring for it but 3 years gives the industry time to ease thru the tariffs and prices to level out before we jump into a new lease or find/buy something we love.
3) WWIII wipes us all out and our lease is ended prematurely by nuclear vaporization (really hoping this one doesn’t pan out tho).
For those that care, we went from a ’20 Mini Countryman S in British Racing Green and got into a ’25 Kia Telluride EX X-Line in Wolf Gray. I could not convince my wife to consider a minivan (what we actually need), even with the promise to trick it out any way she wants. And I loathe monochromatic colors but their Midnight Lake Blue & Jungle Green weren’t striking enough compared to the BRG we departed from and my wife hated the Dark Moss (kind of a bronze-ish color, would’ve been my choice). So alas, we have a monochromatic crossover in our driveway. I miss the pep, handling, but honestly I mostly miss walking up to the British Racing Green in a sea of monotone parking lots – we got compliments at least once a week. We loved that green. But to its credit, I really enjoy being able to drive with a car seat behind me without my knees pressing into the dash/console (we’ll have one behind both front seats come August), adaptive cruise control is pretty sweet, and most importantly….. I FINALLY HAVE VENTILATED SEATS!!! They are a firm deal breaker on all my future cars living in FL.
Congrats on the expanding family! It’s nice to see sentient people procreating. My 30-year-old son and his wife are also expecting. When their Ford Escape died for a stupid battery clamp issue, they bought a Mazda CX-3, so I guess I educated him well. And the Escape can still be a backup vehicle, should the Mazda do something weird. The Escape came back to life when a mechanic figured out what the problem was. So now they are a two-car family.
“Leadership at General Motors and Ford Motor Co. are reassuring employees and investors that the companies are working on how to best navigate the turbulence they foresee coming out of the 25% tariffs President Donald Trump imposed on all imported autos and most auto parts.”
Short term, not much can be done aside from re-sources some parts and passing on the added cost onto consumers. Another thing that should be done… stop all political donations to all Republicans at all levels. And tell the Republicans that it’s necessary cost-cutting due to the Trump Tariff Tax.
Long-term, the best way to fix this is to get Trump and his gang of idiots out of office… one way or another.
“adding that the system alerted the driver to take over the vehicle two seconds before it hit a concrete barrier.”
I recall reading the same issue with other “self-driving” systems (such as Tesla’s)… they’re smart enough to get into trouble, but not smart enough to get out of trouble. And they conveniently turn themselves off 1-2 seconds before an immanent crash. I have to wonder if that is by design in a cynical approach to avoiding liability by enabling the manufacturer to cynically say “the self driving system was not in use at the time of the crash”.
“Are you more or less encouraged to buy a new car right now?”
I’m not in the market and these recent events encourage me to hang onto my current car for as long as possible.
And when the day comes that I need to replace my car, if the Trump and/or the Republicans are still running the show in the USA, that replacement car will not be built in the USA or be built by a company with its global headquarters in the USA.
Wonder how they’ll put the tariffs on the sticker price. Increase the ‘destination charge’? Or add a charge for tariff fees? I have a feeling car companies will advertise a regular MSRP plus ‘additional fees’.
They should label it the trump tax on every vehicle.
> Hear me out, Mercedes. Let’s make a movie where you give me an Actros hauler full of AMGs and a Project.ONE and I’ve gotta Smokey and the Bandit it across the border by April 3rd.
I’m totally here for this, as long as no major Hollywood studio produces the film.
Unfortunately, both my wife and I are going to need a new vehicles in the next 4 years. We drive too much for work and our cars are old. I think the plan is hold out the best we can.
When it becomes critical, I will buy something cheap. 25% of $25K is less then 25% of 50K. Minimize the impact I guess.
I spent today purchasing all of the components of a solar system before tariffs hit. Total cost is about double the most expensive car I’ve ever purchased. I’ll probably be disappointed later this year with tariffs when I purchase a kei truck later this year.
I’ve had a hell of a time sourcing my solar system in this economic environment. Burned plenty of resources getting Mercury and Venus. Earth was simple, I missed a sweet opportunity to get Mars. I don’t feel like I got my money’s worth with Jupiter and Saturn has been a nightmare to find at a reasonable price-I feel like I have to give up my firstborn . Uranus has been, predictably, a real sh*t show. I’m already underwater on Neptune. And Pluto, well, I’m not sure if I go with the classic Solar System or not so I’m on the fence there. Glad to hear you got yours before tariffs kick in!
I drive EV so a solar system is high on my to-do list. Problem is I live in a historic district so I have to use more expensive solar shingles and I am *not* about to give Elon my money. I hope the GAF solar shingles are made domestically but I somehow doubt it
What sliver of a percent would actually go to him? You’re giving more to the installers, suppliers and a bunch of folks and their families between you and whatever percent of a penny Musk would actually get. Not to mention the added savings for you. Just get them. They’re the best option out there for your house.
I don’t care if it’s a small percentage. There are other options on the market that give him nothing. I voted with my dollars. I’ll be getting the GAF solar shingle, assuming the tariffs don’t put them out of business
If you have financial knowledge where cars have gone off the rails expensive make them even more expensive so no one can afford them. Eliminate the Biden insanity EV requirements. Roll back government regulations and soon the average cost of a vehicle will roll back to a sane amount that can be financed for 5 years.
Riiiigght.
Because recently, on this same site, there haven’t been articles about how some cars are barely any more expensive at all than they were over 40 years ago.
https://www.theautopian.com/the-2025-toyota-camry-is-barely-more-expensive-than-a-1983-camry-how-much-better-is-it/#:~:text=The%202024%20Toyota%20Camry%20starts,it's%20equal%20to%20%2479%2C083%20today.
But, much like some people in charge, it’s easier just to blame a 3rd party for everything and then get out the pitchforks. That takes so much imagination to do and it worked out so well for a certain triumvirate of nations in the 40s. Complex problems usually do have extremely simple solutions that we all are just constantly overlooking because everyone but these few bigly smart people are geniuses.
And in case you couldn’t tell, because who knows, that was all sarcasm.
Prices never go down. “Deflation” is such a third rail of economics that it’s known as the death spiral. Wages sometimes come up to meet the new prices to make them seem more affordable.
That’s the gamble that Trump is taking here, that somehow this stimulates the job market. There’s still a very large risk, though, that prices go up and unemployment goes up, then it’s 1975 stagflation, again.
Agreed. It’s going to be interesting to see where this goes. Maybe car makers will finally offer the low cost base models to reduce the impact of the tariffs again. Like they used to do and so many people claim they want again. Could be a good thing for all us car people. I’m going with the half full thought here since it’s all I can do personally. ha
Deflation isn’t a thing. It doesn’t work like that.
Deep thinking tariffs makes cars too expensive. People stop buying $75,000 pickups and $40,000 cars with 84 months financing. People keep driving their current vehicle. It helps the environment because production of cars is 90% of the pollution they cause. If I buy a less pollution vehicle but trade in my gas guzzler I have the pollution from my new car the pollution making it causes and the pollution caused by the person who bought my trade in. Can anyone explain how this helps the environment?
Your numbers are way off. The proportion of a vehicle’s production emissions to operation emissions is roughly 1:4, or 1:3 in the case of BEVs. Not even close to 9:1.
https://www.zemo.org.uk/assets/workingdocuments/MC-P-11-15a%20Lifecycle%20emissions%20report.pdf
When you just take random stabs in the dark at data without caring at all about facts or figures, it’s pretty easy to miss by orders of magnitude.
Less encouraged.
I’ve thought about downsizing the family’s Armada to get something smaller with better MPG now that I have an Express van that can tow heavier trailers.
But Nissan depreciation is killer.
I put down a healthy amount and thanks to that we’re not upside down but also have pretty much 0 equity at this point.
Rates are still too high to start a new loan, and the car’s been super solid, not a single issue these past 2 years. The only thing that’s bad is the MPG.
I’ve tried a couple of hybrids I liked, like the CR-V.
But the math just ain’t mathing with gas savings and more expensive payments.
And now everything’s going to be super expensive, and it’s going to be even harder to break even.
No car changes here. In fact, I’ve discovered comparable examples of my car (2014 Sportwagen TDI) are listed at the same price, adjusted for inflation, that I paid for it in 2020. In light of that, it feels especially good to know it’s paid off in May. Not like I plan on selling or anything, it’s just interesting to own something that bucks the typical depreciation curve.