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  • Drew Dowdell
    Drew Dowdell

    By Drew Dowdell •

    Tariff Tuesday - Big Trouble in Little Crossovers

      Trump's tariffs may hit the small crossover market especially hard.

    Tariff Tuesday is the day where we cover how President Trump’s tariffs, if fully enacted, will impact the auto industry, increase costs, and limit consumer choice.  We started this series on April 15, Tax Day for those in the United States, because Trump’s tariffs amount to one of the largest single increases in taxes on the American People. The tariffs which, if fully implemented, will raise $1.4 trillion in revenue, an increase per household of $1,900 to $7,600 per year.

    Last week we discussed Buick’s Tough Spot - Killing it in China, Killed in the U.S. and one of our readers brought up an excellent point:

    Quote

    The Envista and Encore GX hit the sweet spot of small SUVs at under $30k, but the tariffs would wreck that formula.  Although the Kia Seltos, Hyundai Kona, VW Taos, are all imported too and would suffer the same problem.

    Big Trouble in Little Crossovers

    2025 Ford Maverick Tremor - Running side viewThe little crossover segment is one of the hottest and most competitive segments in the industry. So much so that even before tariffs, a few models were already driven from the market without replacements. The Fiat 500X, Jeep Renegade, Nissan Rogue Sport, and Ford EcoSport were all models competing in this segment in the U.S. that just couldn’t quite make it and were canceled after a single generation, though the Jeep Renegade lives on in other markets.

    The commentator above is right. With few exceptions, nearly all of the little crossovers available in the US are imported.  Because there is a lot of fuzziness in the size of vehicles in this class, for this list we will generally be looking at the smallest crossovers a particular brand offers. We are also including vehicles regardless of price as the tariff impact in this size class appears to transcend price.

    Acura ADX - Mexico

    Alfa Romeo Tonale - Italy

    Audi Q3 - Hungary
    Audi Q4 eTron - Germany

    Audi has indicated they may move production of some models to the U.S., likely through partnership with parent company Volkswagen and their production facility in Tennessee.  Audi has paused all imports of their vehicles to the U.S. due to the tariffs and is holding vehicles already in the U.S. at ports.

    BMW X2 - Germany
    BMW X3 - United States

    Buick Envista - South Korea
    Buick Encore GX - South Korea
    Buick Envision - China

    Cadillac XT4 - United States (model canceled)
    Cadillac Optiq - Mexico

    Chevrolet Trax - South Korea
    Chevrolet TrailBlazer - South Korea
    Chevrolet Equinox - Canada
    Chevrolet Equinox EV - Mexico

    Dodge Hornet - Italy

    Ford Bronco Sport -Mexico
    Ford Maverick - Mexico
    Ford Escape - United States 

    Genesis GV60 EV - South Korea
    Genesis GV70 - South Korea

    GMC Terrain - Mexico

    Honda HR-V - Mexico
    Honda CR-V - United States

    Hyundai Venue  - South Korea
    Hyundai Kona  - South Korea
    Hyundai Ioniq 5 - United States as of 2025 model year to take advantage of EV Tax Credit eligibility from the Biden Inflation Reduction Act. Eligibility for the tax credit is still in limbo.
    Hyundai Tuscan - United States

    Infiniti QX50/QX55 - Mexico

    Infiniti has announced they have suspended all new orders of these models in the U.S. due to Trump’s tariffs. The models remain in production for other markets.

    Jeep Compass - Mexico.

    Kia Soul - South Korea
    Kia Seltos - South Korea
    Kia Niro - South Korea
    Kia Sportage - United States
    Kia EV6 (exc. GT) - United States as of 2025 model year to take advantage of EV Tax Credit eligibility from the Biden Inflation Reduction Act.
    Kia EV6 GT - South Korea

    Range Rover Evoque - United Kingdom
    Discovery Sport - United Kingdom

    Lexus UX - Japan
    Lexus NX - Canada
    Lexus RZ - Japan

    Lincoln Corsair - Mexico
    Lincoln Nautilus - China

    Maserati Grecale - Italy

    Mazda CX-30 - Mexico
    Mazda CX-5 - Japan
    Mazda CX-50 - United States

    The Mazda CX-50 is produced in the United States, and until the tariffs, was exported to the Canadian market. Mazda has since shuffled production and will now supply the Canadian market from Japan.

    Mercedes-Benz GLA - Germany
    Mercedes-Benz GLB - Mexico
    Mercedes-Benz EQB - Hungary
    Mercedes-Benz GLC - Germany

    Mini, Mitsubishi, Porsche - Austria, Japan, and Germany respectively

    Nissan Kicks - Mexico
    Nissan Rogue - United States

    Polestar 2 - China
    Polestar 3 - United States

    Rivian R2 - United States (not in production yet)
    Rivian R3/R3X - United States (not in production yet)

    Subaru Crosstrek - Japan and starting in 2024 United States for select trims
    Subaru Forrester - Japan

    Tesla Model-Y - United States

    Toyota Corolla Cross - United States
    Toyota RAV-4 - United States and Canada

    Volkswagen Taos - Mexico
    Volkswagen Tiguan - Mexico
    Volkswagen ID.4 - United States

    Volvo EX30 - China
    Volvo EX40 - Belgium
    Volvo XC40 - Belgium
    Volvo C40 - Belgium


    Of this list of 70-ish small crossovers, only eleven models plus some versions of a twelfth are assembled in the United States.  For the sixteen that are assembled in Canada or Mexico, they may possibly qualify for reduced or exempted tariffs if they can prove compliance with the USMCA. However, meeting the USMCA regulations is an arduous process for a product with as many components as a vehicle. A vehicle with a significant amount of components produced outside of the USMCA zone will likely fail to qualify for a tariff exemption.  For example, a vehicle assembled in Canada may lose its tariff exemption if the steel used in its construction was purchased from China or the stamping took place outside of the USMCA zone.  It’s a complex process for manufacturers to calculate, and some, such as Audi and Infiniti are simply opting to stop shipments for now. It’s likely that EVs built in Canada or Mexico that currently qualify for the tax credit from Biden’s Inflation Reduction Act will also qualify for a USMCA exemption.

    Some manufacturers are hit harder than others. Ford's recent smash hits, the Bronco Sport and Maverick truck are both built in Mexico and represent a significant portion of Ford's recent sales. Dodge, already struggling to move the Hornet crossover, will face significant price increases as it is not able to be exempted from tariffs via the USMCA. Toyota will gain an unusual prices advantage here with the RAV-4 and Corolla Cross being built in the United States, but can also afford to not discount prices much as demand will be higher.

    All of the burden of Trump's tariffs trickles down to the consumer eventually. Consumers will either pay higher taxes on imported vehicles, pay higher prices for manufacturers to comply with the USMCA, or lose choices and supply with lost model availability driving up the costs of the remaining options on the market. For one of the most competitive segments of the auto industry, this signals a time of turmoil with consumers taking the brunt of it.

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    G. David Felt

    The Mazda CX50 is a compact that built in the U.S. for Canada and is now paused for production and jobs as they will import them from Japan to avoid the idiotic tariffs.

    Then we also have Subaru, Honda and Stellantis that has all paused production of select models that are exported to Canada, Mexico or outside North America for sale that have been paused with temp layoffs due to the tariff's stupidity. 

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    Drew Dowdell
    22 minutes ago, G. David Felt said:

    The Mazda CX50 is a compact that built in the U.S. for Canada and is now paused for production and jobs as they will import them from Japan to avoid the idiotic tariffs.

    Then we also have Subaru, Honda and Stellantis that has all paused production of select models that are exported to Canada, Mexico or outside North America for sale that have been paused with temp layoffs due to the tariff's stupidity. 

    To clarify, CX-50 production will remain in the US but will only be for US market customers. The pause is only for Canadian market builds. Mazda is increasing US market builds to make up the difference, likely because they know that other imported models will take a sales hit from the additional taxes and Mazda can capture those with a domestically manufactured CX-50.  Mazda very specifically said in a statement that overall production volume is not expected to change.

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    A Horse With No Name
    10 minutes ago, Drew Dowdell said:

    To clarify, CX-50 production will remain in the US but will only be for US market customers. The pause is only for Canadian market builds. Mazda is increasing US market builds to make up the difference, likely because they know that other imported models will take a sales hit from the additional taxes and Mazda can capture those with a domestically manufactured CX-50.  Mazda very specifically said in a statement that overall production volume is not expected to change.

    Subaru will be building a ton of stuff apparently for the Canadian and Mexican markets in Japan that was formerly built in the USA.

     

    33 minutes ago, G. David Felt said:

    The Mazda CX50 is a compact that built in the U.S. for Canada and is now paused for production and jobs as they will import them from Japan to avoid the idiotic tariffs.

    Then we also have Subaru, Honda and Stellantis that has all paused production of select models that are exported to Canada, Mexico or outside North America for sale that have been paused with temp layoffs due to the tariff's stupidity. 

    It will only get worse. BYD builds buses, SUV's and all sorts of other stuff. They are killing it in every market outside of the USA. If they were alowed to sell inside the USA Tesla would go bankrupt. Quickly. 

    BYD is also the biggest selling electric in Brazil, a huge market. 

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    ccap41
    3 minutes ago, A Horse With No Name said:

    It will only get worse. BYD builds buses, SUV's and all sorts of other stuff. They are killing it in every market outside of the USA. If they were allowed to sell inside the USA Tesla would go bankrupt. Quickly. 

    I don't know about that. People still have to want to buy a Chinese owned and built vehicle. That's a pretty big sell here unless it were to be vastly cheaper than the competition. 

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    Drew Dowdell
    5 minutes ago, A Horse With No Name said:

    Subaru will be building a ton of stuff apparently for the Canadian and Mexican markets in Japan that was formerly built in the USA.

    Yes, and we will likely see Subaru shift more crosstrek production to the US for US market with that capacity. It might mean that Forrester production moves here too.

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    A Horse With No Name
    9 minutes ago, Drew Dowdell said:

    Yes, and we will likely see Subaru shift more crosstrek production to the US for US market with that capacity. It might mean that Forrester production moves here too.

    I think Forester production was supposed to move here...before the trade war. Not sure though. 

    11 minutes ago, ccap41 said:

    I don't know about that. People still have to want to buy a Chinese owned and built vehicle. That's a pretty big sell here unless it were to be vastly cheaper than the competition. 

    BYD makes great products, I don't think they would face a lot of resistance. 

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    smk4565

    Prices on all these will go up.  I see ads from manufacturers saying they are protecting MSRP though May or 2025 model year.  But they probably all had 60-100 day supply of vehicles which almost gets them to when 2026 models would start.   And they are going to pull incentives in the short term.  I suspect 2026 MSRP’s are going way up.

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    ccap41
    5 minutes ago, A Horse With No Name said:

    BYD makes great products, I don't think they would face a lot of resistance.

    How do you know they make great products? They don't sell anything here, yet. Spec sheets can be amazing and it still not be a good overall product or it could be unreliable as fck. 

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    G. David Felt
    7 minutes ago, ccap41 said:

    How do you know they make great products? They don't sell anything here, yet. Spec sheets can be amazing and it still not be a good overall product or it could be unreliable as fck. 

    He just visited Mexico and had some time looking at the products. I will, say that all my coworkers in other markets where BYD sells autos have pretty positive impressions of BYD as they go Global. I can see BYD surpassing Toyota as the world's biggest auto builder.

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    Drew Dowdell
    44 minutes ago, smk4565 said:

    Prices on all these will go up.  I see ads from manufacturers saying they are protecting MSRP though May or 2025 model year.  But they probably all had 60-100 day supply of vehicles which almost gets them to when 2026 models would start.   And they are going to pull incentives in the short term.  I suspect 2026 MSRP’s are going way up.

    Dodge can keep Hornet at pre-tariff pricing until 2027 at the rate they're selling.

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    G. David Felt
    7 minutes ago, Drew Dowdell said:

    Dodge can keep Hornet at pre-tariff pricing until 2027 at the rate they're selling.

    Was wondering what the sales numbers are and I see since it came out, it has gone now where but down. Slowest selling auto for years now.

    Dodge Hornet Tops The U.S. Slowest-Selling Vehicle List Again - MoparInsiders

    That is pretty pathetic, I honestly have not seen any here in the wild for the PNW, so I do wonder where they are selling.

    WOW, Just saw that they have a 428 day supply on hand. Crazy

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    G. David Felt

    Removing tariffs that idiot47 caused so much pain with for getting nothing in return show how stupid a person can be in not understanding true business and how to negotiate. 

    A real man with Business sense would have put together a package of tariffs to present to China to address specific areas that are an imbalance not just attack everything and see what falls out. As such, incompetence in not understanding the long road map to building greatness shows how foolish the current administration is and now they are going to sign an exception list for the auto industry. Destroy good trading partners just to cause Chaos! Never a sound business strategy.

    Trump to Sign Order Later Tuesday Easing Auto Tariff Impact

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