This is new that could have a major impact on the cars we love. For decades the economic policy in the US has been to keep import tariffs low in support of free trade and economic growth. A quick look at the longterm data shows that that has worked tremendously for the US economy. But that may be changing. According to reports from the German publication Wirtschaftswoche, US President Donald Trump revealed to French President Macron that he intends to raise tariffs to 25% on all European cars in an effort to decimate European car sales in the United States.

The president’s reported disdain for luxury German automobiles, particularly Mercedes, is so strong that he’s said that the goal of this tariff would be to eliminate them from New York’s Fifth Avenue – an epicenter of wealth in New York City.

Lets not mince words here. A 25% tax on European cars might destroy BMW in the United States. Currently the US levies a 2.5% tariff on BMW and other European cars. That means a $60,000 BMW has $1500 of US tariffs on it currently meaning it’s actually $58,500 before entering the US. If Trump imposes this rumored plan that $58,500 BMW won’t be $60,000 anymore. It would be $75,000.

25% Tax on European Cars

Think about that for a minute. Imagine a BMW M2 Competition which should be just a bit less than $60k once the price is announced. With an option or two you’ll have yourself a $60,000 BMW (including that current 2.5% tariff). Under the rumored plan that M2 will now cost $75,000 moderately equipped. It might still win in the fun to drive category but that price would be a huge hurdle for most people when cross-shooing Asian and American cars.

If prices were to be raised on BMWs by 23.5%, it would not only kill sales in the US but it would almost immediately destroy thousands of American livelihoods at BMW dealers not to mention BMWNA corporate. What can be done? Unfortunately the president has direct authority to issue a tariff like this. However your voices can still be heard by contacting your elected officials and voicing your concern here and throughout the web.