NEW YORK - Finding an affordable car in the United States has already become a challenge for many budget-constrained Americans, as new import tariffs on Mexican-built vehicles threaten to make the problem worse, The Wall Street Journal (WSJ) has reported.
Today, nearly one-third of all vehicles priced below $30,000 and sold in the United States are built in Mexico, including the Nissan Sentra, Ford Maverick and other popular nameplates, according to an analysis by car-shopping website Edmunds. A decade ago, Mexico was responsible for one-fifth of the affordable cars sold in the United States, the firm's data shows.
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"The border country has long been a go-to for automakers looking to defray the hefty expense of manufacturing a car, particularly on smaller models that sell for lower price points and have slimmer profit margins than larger trucks and SUVs," noted the report.
President-elect Donald Trump has threatened to upend this strategy, pledging in November to impose 25 percent tariffs from Mexico and Canada, a move that could mean undoing the free-trade agreement he negotiated in his first term, said the report.
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"Any new tariff-related costs are likely to be passed along to the consumer -- at least in the near-term -- and would hit the most affordable cars and SUVs the hardest," the report cited analysts and dealers, adding that some lower-price models and car parts built in the two neighboring countries would additionally be subject to new trade duties, further pushing up costs for manufacturers and consumers.