While the Auto Care Association, which represents the more than $500 billion USD automotive aftermarket industry in the United States, does not put a firm figure on the cost to consumers for recently threatened 25% Canadian and Mexican import tariffs, it is clear on the integrated nature of the automotive supply chain, and who would bear the cost of those tariffs.

President-elect Trump posted on his social media in early December 2024 that on Jan. 20, 2025, he plans on imposing a 25% tariff on imports from Mexico and Canada and an additional 10% tariff on imports from China.

He positioned the proposal as a tool to put pressure on Canada and Mexico to address illegal immigration and drug trafficking, singling out fentanyl.

The President-elect also separately threatened a 100% tariff on BRICS countries should they pursue a regional currency.

In a statement, the Auto Care Association said that while it acknowledged the importance of the illegal immigration and drug trade issues, “Tariffs of this magnitude on America’s largest trading partners could dramatically raise prices for U.S. consumers and U.S. businesses.”

Mexico and Canada are the U.S. auto care industry’s largest and most critical trading partners, accounting for 58% of auto parts imports to the U.S. and 76% auto parts exports in 2023. According to information from the association, Canada represents 12% of all auto parts imports to the U.S. worth some $16.1B USD annually, and 36% of all exports from the U.S., worth $18.4B USD. Larger trade is across the U.S.-Mexico border, which represents 47% of imports into the U.S. ($64.8B) and 40% of exports ($20.B).

The Auto Care Association did not specifiy a detailed financial cost to U.S. consumers, but the implication is clear considering the tariff-free nature of most auto parts trade, covered by the Canada-US-Mexico Agreement (CUSMA); the 25% blanket levy would easily add $20B USD in automotive-related costs to U.S.consumers, though actual costs could be much higher due to the transborder nature of automotive manufacturing.

And of course higher costs would also be across product categories beyond automotive; For example, U.S. imports of crude oil from Canada reached a record of 4.3 million barrels per day (b/d) in July 2024, amounting to about $250 million USD a day. The United States consumed an average of about 20.25 million barrels of petroleum per day in 2023. A 25% tariff could add $50 million per day, or more than $20B USD a year in crude oil costs, likely more in refined products, likely all passed along to consumers.

In total, Canadian exports to United States reached $439.6B USD during 2023, according to the United Nations COMTRADE.

The Auto Care Association has previously testified before U.S. trade bodies on the impact of tariffs and reiterated those arguments following the latest messaging from the President-elect, arguing that beyond the upfront cost, increased prices will also cause consumers to delay critical maintenance.

“Tariffs are not paid for by our trading partners; instead, they are passed down the supply chain and are a financial burden on families trying to access affordable parts to repair and maintain their vehicles. Delays in vehicle repairs and maintenance pose a safety risk for drivers, passengers and pedestrians,” said the association.

“Additionally, tariffs are a significant financial strain on businesses that must pay the tariff costs upfront, tying up resources and capital that would otherwise be used for other investments and growing the business. For small and medium-sized businesses, this could result in cash flow challenges, delayed payments, reduced capacity and inventory, causing businesses to scale back the operations.”