The Trump administration's trade war will make Toyota pickup trucks and minivans more expensive, adding about $3,000 to the sticker price of some of its best-selling automobiles, Toyota executives said after reporting record profits Friday.
Global net income at the Japanese automaker rose from 613.0 billion yen ($5.52 billion) to 657.3 billion yen during its first quarter ended June 30. But executives told reporters on a call Friday that the increased U.S. tariffs could seriously affect Toyota's bottom line and hurt jobs.
"A 25 percent tariff on automotive imports, which is just a tax on consumers, would increase the cost of every vehicle sold in the country," Toyota said in a statement.
The extremely popular Toyota Camry sedan, which is assembled in Kentucky, would cost an extra $1,800 if a 25 percent tariff were to take effect, the company said.
Toyota's full-size pickup, the Tundra, and the Sienna minivan, which are also assembled in the U.S., would cost an extra $2,800 and $3,000, respectively.
Even fleet customers, such as drivers for taxi companies or ride-hailing services such as Uber and Lyft would be hit by increases.
"This is not helping those blue-collar workers who voted for Trump," Kelley Blue Book senior analyst Rebecca Lindland said. "Renegotiating NAFTA is long overdue. But slapping tariffs on an inflexible industry is not protecting American jobs, American investors or American consumers."
Toyota employs 137,000 people in the U.S. at its 10 factories and dealership network here, the company said in a statement.
"They are not a national security threat," Toyota said, alluding to President Donald Trump's rationale for the increased tariffs.
Trump has already slapped 25 percent tariffs on several billion dollars of goods from China and is investigating the possibility of imposing similar tariffs on imports from other countries, including autos and vehicle parts. The Trump administration has justified these tariffs by invoking Section 232 of Trade Expansion Act of 1962, which allows the government to consider tariffs on products when it is in the interest of national security.
Tariffs will not just be painful for foreign corporations or investors, Lindland said.
Forcing sudden changes to the automotive supply chain can create problems and raise consumer costs, she said. Even car parts can cross borders more than once during assembly, Lindland said, adding that it also has an effect that ripples outward toward dealers, mechanics and customers.