Could Proposed Tariffs Impact Exotic Car Sales?

 Posted on December 13, 2024 in Exotic Car Maintenance

While the incoming administration's proposed tariffs have rattled European auto giants, exotic car manufacturer Ferrari seems relatively unfazed. Steep tariffs have been proposed for China, Canada, and Mexico, shaking up the auto industry's supply chain and creating higher costs. While Europe was not specifically mentioned in the first round of tariff announcements, many believe it is only a matter of time.

Many United States and European auto manufacturers have built factories in Mexico and rely on Mexico-based suppliers of auto parts. Generally, a 25 percent tax on imports from Canada and Mexico would have a major impact on the car industry as both Canada and Mexico would likely place the same tariff on their own imports. Such a tariff would likely even spill over into the cost of repairs for exotic cars since the parts would cost considerably more.

While it is unclear at this point how much the tariffs could be and whether they will include Europe, many car manufacturers are pre-emptively looking at raising prices. If you own an exotic car, now might be a good time to have it maintained and repaired by the highly trained Forest Hill, MD vehicle technicians at Rosso Service.

This ensures your car will be in tip-top condition should the price of parts rise. If you had planned on buying an exotic car, now might be the right time to do so. If you plan to buy a pre-owned exotic car, a pre-purchase inspection is crucial to ensure your car is in the best shape.

Will Exotic Car Manufacturers Give In and Manufacture Their Cars in the United States?

The average new car now costs almost $50,000, while the average price of a new exotic car can be as much as $178,000. Adding 25 percent to that amount will likely prevent many Americans from buying the cars they had planned to buy. The one exception in exotic cars may be Ferrari. A spokesperson stated that as far as Ferrari is concerned, the company will never begin manufacturing the car in the U.S. and that "everything happens in Maranello, Italy."  

This is not to say that the tariffs on Ferraris will not be passed on to American consumers, just that tariffs – no matter how much they are – will not likely force Ferrari to manufacture its exotic cars in the U.S. Ferrari shares have climbed over 34 percent, and the company is currently outperforming rival carmakers in Europe, so, of course, Ferrari can afford to be less concerned over the potential of tariffs.  

A spokesperson for Porsche (which builds its exotic cars in Germany) stated that a 25 percent tariff would have to be passed on to customers because Porsche shares are down almost 26 percent, unlike Ferrari. However, Porsche is unique in that it could potentially "piggyback" off the parent company, Volkswagen, to manufacture Porsche's exotic cars in the United States.

Many cars are built through a back-and-forth process between countries. One country may manufacture a specific part that requires parts from another country, which is installed in a part made in a third country and then shipped to the country putting the car together. This dizzying process can result not only in tariffs but also in retaliatory tariffs, making every part of the car more expensive.   

Contact a Baltimore, MD Exotic Car Maintenance and Repair Expert

Whatever your decision, if you already own an exotic car, you want to ensure it is maintained and repaired to the highest standards. When you contact a Washington, D.C. exotic car maintenance and repair expert from Rosso Service, you will benefit from our highly trained, factory-certified professionals. We can schedule your drop-off 24/7 and may be able to offer transportation services. We also offer tours of our state-of-the-art facility. Call 410-638-2886 today to schedule your maintenance or service.