Chicago, USA – For nearly 70 years, Steve Walter’s family has been repairing cars on the North Side of Chicago. Now, as the fourth generation in the family business, Walter is worried about the impact of President Trump’s new 25% tariffs on imported vehicles and auto parts.
Set to take effect on April 2, 2025, these tariffs are expected to raise the cost of car repairs, replacement parts, and even auto insurance.
“These tariffs are going to increase the average repair order,” Walter told CBS News. “They’re also going to raise insurance premiums. They’re going to go up.”
What the New Tariffs Mean
President Trump’s plan includes:
- 25% tariffs on all imported vehicles and auto parts, starting April 2
- Tariffs on steel and aluminum have already begun earlier this month
- A temporary one-month delay was granted for automakers like Ford, GM, and Stellantis after the president spoke to company leaders
- Imports from Mexico and Canada, normally protected under a 2020 trade deal, are also included—starting April 2
Real Impact: Higher Repair Bills and Part Prices
In Walter’s garage, mechanics replace car parts more often than repair them. So rising part prices will directly impact repair bills.
Take this example:
- A fender that currently costs $200 could soon cost $250
- That’s a 25% increase, and it’s just the beginning
Last year, the average repair cost for a 5-year-old car was between $5,073 and $6,274, according to CCC Intelligent Solutions. With these tariffs, repair bills could increase significantly in the next 6–12 months.
Auto Part Suppliers Feel the Pressure
At Fred Billeh’s Discount Auto Warehouse in Chicago, nearly all the parts on the shelves come from countries affected by the new tariffs.
Billeh estimates he stocks millions of parts, and he remembers what happened when tariffs were imposed during Trump’s first term.
“Prices went up in 2019, and they’ll go up again,” Billeh said. “The extra cost always gets passed on to the customer.”
Auto Insurance Premiums Likely to Rise
The Insurance Information Institute had already predicted that auto insurance premiums would rise by 7% in 2025—and that was before the new tariffs were announced.
Now, the impact could be even worse.
“If you’re increasing costs here, eventually it’s going to show up in your premium bill,” said Bob Passmore, vice president of the American Property Casualty Insurance Association, which represents insurance companies.
Passmore explained that the effect of these tariffs will create a ripple, and the real impact may be felt 12 to 18 months from now.
With the April 2 deadline approaching, auto shop owners, part suppliers, and consumers are preparing for higher costs. From repair bills to insurance premiums, the 25% auto and parts tariffs introduced by President Trump are expected to affect nearly every driver in the U.S.—even those not buying a new vehicle.
For small businesses like Steve Walter’s, this means rethinking prices, services, and customer expectations. And for American drivers, it means spending more to keep their cars running.