Investor’s Business Daily reports:

A day after auto stocks broadly declined, the sector lost more ground Friday. The threat that President Donald Trump’s 25% tariffs on all foreign-made vehicles could “send the auto industry into pure chaos,” and boost the average price of cars between $5,000 and $15,500, according to an analyst.

Wedbush Securities analyst Dan Ives on Friday said, after talking to auto industry players from around the world over the prior 24 hours, that the tariffs will add around $100 billion of annual costs to the auto sector. Those costs will get passed directly onto the consumer and that would “clearly erode demand,” Ives wrote.

“Every automaker in the world will have to raise prices in some form selling into the U.S. and the supply chain logistics of this tariff announcement heard around the world is hard to even put our arms around at this moment,” Ives wrote.

Trump has reportedly already warned U.S. automakers against raising prices in response to tariffs, according to the Wall Street Journal.

Ives added that U.S. automobiles typically have around 40%-50% of their components come from abroad. A “U.S. car with all U.S. parts made in the U.S. is a fictional tale not even possible today.”

“The winner in our view from this tariff is no one … as even Tesla still is hit from these tariffs and will be forced to raise prices,” Ives said. [Continue reading…]