Is It Time to Buy or Lease Your Car? Key Insights for Smart Drivers | CNN Business

With a 25% tariff on imported cars looming, many Americans are asking whether they should buy or lease a vehicle now or wait. Experts have a clear answer: buy now, especially if you need a car.

Aaron Bragman, a car expert from Cars.com, warns that delaying your purchase could cost you more in the long run. “The riskiest thing to do is to hold off and see what happens,” he says. Prices are expected to rise.

The Trump administration announced the tariff recently, affecting all foreign cars, including those from Canada and Mexico. According to a Goldman Sachs report, this could increase car prices by $5,000 to $15,000 depending on the model. Tariffs on car parts could also follow, making American-made vehicles pricier since they rely on parts from abroad.

For instance, cars from major brands like Ford and Honda may see their prices jump between $4,000 to $10,000. Electric vehicles might see increases of at least $12,000.

Since the tariff announcement, many buyers have rushed to dealerships. Online traffic for car-buying sites like Kelley Blue Book and Autotrader.com surged by 30% as people look to make a purchase before the tariffs set in.

Jenni Newman, editor-in-chief at Cars.com, noted that cars already on dealer lots won’t incur the tariff until April 3. However, finding a good deal could become harder as dealerships anticipate higher prices for incoming cars.

Inventory levels are relatively stable compared to previous shortages during the pandemic. However, as tariffs take effect, the market may shift. Automakers could cut production due to lower demand, further impacting availability.

A notable consequence of rising prices is the likely increase in interest for used cars. Yet, the used car market is already facing low inventory. The pandemic’s production limits mean fewer cars are available for resale today, which could lead to even higher prices for used vehicles.

Currently, only 27 new cars are priced under $30,000, with some models already discontinued, making it tougher for budget-conscious buyers. Cox Automotive analyst Erin Keating points out that cheaper cars typically come from abroad and may soon be cut from production lines due to rising costs.

As we await these changes, it’s clear that buying now is a smart move if you can find a car you like. Prices are expected to rise, and the market may shift significantly in the coming months. So, it’s better to act than to wait and risk paying more later.

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