It's not just iPhones and TVs. President Donald Trump's tariff policies might be driving up the cost of electric vehicles and combustion cars, too. EVs, in fact, might be especially vulnerable to the new tariffs that target China (a major exporter of critical metals) and the steel industry.
China already has a near monopoly on critical minerals and rare earth metals used to manufacture cars, and these tariffs have given China reason to use that as leverage over the United States. That's according to Anne Clawson, co-founder and head of policy and government affairs practice at Cascade Advisory, an advisory firm specializing in manufacturing, clean energy and critical minerals policy.
"What's tricky is that every component is going to be impacted a bit differently," Clawson said. "The tariffs are a major concern for affordability, but also for availability of cars."
While it's still too early to know exactly how things will play out, we asked industry experts like Clawson what you need to know about the tariffs' potential impact on EV prices in the US.
Read more: CNET Daily Tariff Price Tracker: I'm Watching 11 Key Products for Changes, Here's What's Happened
Which Trump tariffs will affect EVs?
Tariffs are essentially taxes on goods that come to the US from other countries. The slew of new tariffs imposed by the Trump administration has a lot of potential to affect the auto industry.
Trump issued a 25% tariff on all foreign-made cars and auto parts and a 50% tariff on all imports of steel, a major input to car manufacturing.
The new tariff stance toward China, in particular, is also relevant here. After negotiations, the US has settled on a 55% tariff on Chinese goods. China is also using its dominance in this area as leverage since processing and exporting critical minerals and rare earth metals are essential to build modern cars, Clawson said. China was restricting the supply of certain rare earth metals that go into cars, she said. But the latest reports show China backing off those restrictions.
Electric vehicles are especially reliant on these metals for battery components, but just about all cars now use some amount of them for operating electronics or enhancing performance, Clawson notes. "You can't really make a car without them," she said.
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