Walk into a dealership looking for the cheapest new car in America and you will land on the Nissan Versa, stickered just under $17,000. The Mitsubishi Mirage, one of the last true subcompacts still sold here, starts around $18,000. Neither rolls off a U.S. assembly line. And under the overlapping tariffs now hitting the auto sector, both face import duties that could tack thousands of dollars onto the price before a single option box gets checked.
That is the core warning in a nonpartisan tariff timeline maintained by the Congressional Research Service (report R48549, updated periodically through 2025), which catalogs the trade actions reshaping the American car market. At the center sits Proclamation 10908, signed by President Donald J. Trump, imposing a 25 percent tariff on imported finished vehicles along with a separate schedule of duties on auto parts. The Office of the United States Trade Representative maintains an index of the proclamation text, amendment history, and effective dates. That proclamation has already been amended at least once. Stacked on top of it is a temporary import surcharge the White House announced in February 2026, described as a response to “fundamental international payments problems.” (No executive order number, Federal Register citation, or direct link to the surcharge text has been identified in publicly available records as of May 2026.) Together, the measures amount to the most aggressive tariff regime applied to automobiles in decades, and the buyers who can least afford a price hike are the ones most exposed.
The models with the biggest targets on their hoods
The vehicles facing the steepest cost increases are those assembled outside North America with limited regional content. The Mitsubishi Mirage is built in Thailand. The Hyundai Venue and Kia Forte come from South Korea. The Nissan Kicks is produced in Mexico, but its global parts network could complicate eligibility for relief under the United States-Mexico-Canada Agreement (USMCA), which shields vehicles with enough North American content from the full 25 percent duty.
Two widely cited industry analyses put numbers to the problem. Cox Automotive published tariff-impact projections in 2025 (as part of its ongoing market analysis series), and the Anderson Economic Group released its own estimates around the same period. Both projected per-vehicle price increases ranging from roughly $2,000 on USMCA-compliant models to more than $10,000 on vehicles shipped from countries without preferential trade arrangements. Those are forecasts, not final receipts, and they hinge on how much cost automakers absorb versus how much they pass along. The specific figures may shift as each firm updates its models, but the direction is not in dispute: tariffs raise the floor on what it costs to put a new car in a buyer’s driveway.
The squeeze lands on a market already tilted against budget shoppers. The average new-vehicle transaction price in the U.S. topped $48,000 in early 2025, according to Kelley Blue Book data tracked by Cox Automotive. The sub-$25,000 segment has been shrinking for years as manufacturers chase higher-margin trucks and SUVs. Tariffs accelerate that trend by making it less profitable to sell low-cost imports, giving automakers even less reason to keep affordable nameplates alive.
What about the cheapest electric options
Budget-minded shoppers eyeing electric vehicles face a similar bind. The Chevrolet Equinox EV, which GM has positioned as a roughly $35,000 entry point into electric driving, is assembled in the U.S. but relies on a global battery and electronics supply chain that could trigger parts-level duties under Proclamation 10908. The successor to the discontinued Nissan Leaf, expected to be sourced from outside North America, would be subject to the full 25 percent vehicle tariff unless Nissan secures USMCA-qualifying production. In short, the tariff layers do not spare EVs simply because they are electric; what matters is where the vehicle and its components are made.
How the tariff layers stack up
This is not a single trade barrier. It is a series of overlapping walls, each with its own rules and carve-outs.
Proclamation 10908 forms the base layer: a 25 percent duty on imported automobiles plus a separate parts schedule. The USTR index page linked above provides access to the underlying legal instruments.
USMCA relief carves out vehicles assembled in Mexico or Canada that meet strict regional-content thresholds. Automakers have spent years engineering supply chains to qualify, but the margins are tight. Swapping in non-North American electronics or drivetrain components can push a model out of compliance. Whether those thresholds will shift in future amendments remains an open question.
Partner-specific deals offer narrow relief. A bilateral agreement with the United Kingdom, announced in May 2025, allows up to 100,000 U.K.-built vehicles to enter at a reduced 10 percent rate. That matters for certain Mini and Jaguar Land Rover models assembled in Britain. What remains unclear is whether the U.K. deal shields those cars from the February 2026 surcharge or only from the original Proclamation 10908 duties. If both layers apply, the bilateral savings shrink fast.
The February 2026 surcharge sits on top of everything else. The White House called it temporary, but no sunset date appears in the publicly available fact sheet, and no executive order number or Federal Register citation has been confirmed in public records as of May 2026. History suggests caution: the steel tariffs imposed under Section 232 in 2018 were also framed as temporary and stayed in place for years. Buyers and automakers alike are planning around a policy that could be lifted, extended, or folded into broader trade negotiations with little advance notice.
How automakers are scrambling to adapt
Manufacturers are not waiting for clarity. Hyundai has accelerated construction of its assembly plant in Georgia, aiming to shift more production onto American soil. Toyota has signaled increased investment in its U.S. and Canadian operations. Stellantis, which builds several models in Mexico and Canada, has publicly lobbied for broader USMCA protections while quietly evaluating which low-volume nameplates still justify production under the new cost math.
But retooling a global supply chain takes years, not quarters. In the near term, the likeliest outcomes are a mix of modest price hikes passed to consumers, thinner inventory of the cheapest models, and the quiet death of nameplates that no longer make financial sense. The Mitsubishi Mirage, already a low-volume seller, is a prime candidate. So is any subcompact or entry-level sedan that depends heavily on parts sourced from outside North America.
What budget-conscious buyers should watch
For shoppers trying to stay under $25,000, the practical math now starts with where a vehicle is built and how much of its content qualifies as North American. A car assembled in the U.S. with a high domestic-parts percentage faces the least tariff exposure. A car shipped from South Korea or Japan with no bilateral carve-out faces the most.
Window stickers are required by federal law to list the final assembly point and the percentage of U.S. and Canadian parts content. That information, once a curiosity for trade-policy enthusiasts, now serves as a rough gauge of how much tariff cost is baked into the sticker price. Models assembled in Mexico deserve a closer look at their USMCA compliance status, which dealers may or may not be equipped to explain.
The used-car market is feeling the pressure, too. As new-car prices climb, demand for late-model used vehicles rises in lockstep, pushing those prices higher. Buyers priced out of the new market do not vanish. They compete for a finite pool of used inventory, creating a ripple effect that touches every tier.
Why the real price tag is still a moving target
Federal documents confirm that auto tariffs as of spring 2026 are real, layered, and still shifting. What they do not supply is a clean answer to the question every cost-conscious shopper is asking: how much more will I pay, and for how long? The administration has not clarified the surcharge’s duration. Federal agencies have not published detailed consumer-impact analyses. Until that changes, the answer will not come from policy papers. It will come from the numbers printed on the next dealer invoice.
