Speed bumps in exports: Auto part makers hope for 'balanced resolution'

Auto parts exports from India may see a slight slowdown as US President Donald Trump's 25 percent tariff could increase car prices for buyers by 8-25 percent, thereby affecting demand, experts believe.

- SHINE JACOB & DEEPAK PATEL

In a March 26 order, the Trump administration subjected automobiles, auto parts, and steel and aluminum articles to Section 232 tariffs at 25 percent. While the detailed list of auto components subject to the import tariff is awaited, industry insiders pointed out that bilateral negotiations may lead to a "balanced resolution".

On the other hand, global auto majors believe a possible free trade deal resulting from the Trump tariff could create a win-win situation for both domestic and international players. The US imported around 8 million cars in 2024, amounting to around $240 billion in trade value.

Cars made in the US contained about 40 percent imported components, according to financial services firm Wedbush Securities.

The move could result in a price increase of $4,000 to $12,500 per car due to tariffs, depending on the vehicle, according to a recent estimate by Anderson Economic Group, a consultancy that has worked with major automakers.