Trump’s Tariffs Are Totaling Affordable Cars

By Marc Wheat & Joel Griffith

Wednesday, May 06, 2026

 

It’s 2028, and after more than 200,000 miles, John’s 2010 Toyota Corolla has finally given out. Like millions of Americans, he needs a reliable and affordable vehicle. Just four years earlier, replacing his car with a new Corolla would have cost John around $22,000. But in 2028, that option no longer exists. Toyota stopped selling the Corolla in the United States in 2026, thanks to rising costs caused by President Trump’s tariffs.

 

John lives in Blue Springs, Miss., and his neighbor, Lisa, used to work at the local Toyota plant, assembling Corollas with parts sourced from the United States, Canada, and Mexico. She was laid off when the company could no longer profitably make and sell these entry-level cars. Lisa’s annual income of $65,000 disappeared. She’s now waiting tables, logging longer hours at lower pay, trying to make ends meet.

 

Unless President Trump abandons his unconstitutional tariff quest and champions the renewal of the United States-Mexico-Canada Agreement (USMCA), a major accomplishment of his first administration, this vision of the not-too-distant future is likely to become a reality.

 

The tariff damage is already concrete. Toyota alone expects tariff-related costs to reach $9 billion in its current fiscal year and has warned of up to three separate price increases in 2026 if tariffs continue. It comes as no surprise, then, that the Wall Street Journal recently reported that companies like Honda, Nissan, and Toyota may have to pull affordable, entry-level cars off the market if the tariffs continue because those vehicles are no longer profitable. Meanwhile, new vehicle prices overall have surged back toward all-time highs since “liberation day,” with midsize SUVs jumping 2.8 percent, adding more than $1,300 to the sticker price. Used vehicles are no refuge: The Manheim Used Vehicle Index is up 6.2 percent since March 2025, as higher new-car prices push buyers into an already tight used-car market. Keeping older cars on the road is no bargain either: Auto repair costs are up 6.1 percent since March 2025, driven by tariffs on the more than 44 percent of collision parts that are imported.

 

The car, particularly the affordable car, is quintessentially American. Henry Ford famously wanted to make cars his employees could afford to buy. Thanks to his breakthrough assembly line, millions of everyday Americans discovered the joy and convenience of automotive travel. More than a century later, personal vehicles enable individuals to chase employment opportunities far from their chosen neighborhoods while juggling family responsibilities and maintaining in-person friendships despite the distance. Cars equal freedom and adventure. That is why the first edition of the Independence Index, published by Advancing American Freedom (AAF), where we work, tracked car affordability as a metric indicating Americans’ ability to pursue happiness. Affordability cratered post-Covid, as the number of weeks of median income needed to buy a new car skyrocketed from 34 weeks prior to Covid to 45 weeks by mid-2022. Prices have increased further since then. With maintenance costs increasing to more than 80 cents per mile, declining car affordability disincentivizes teenagers (barely one in three of whom are in the workforce) and those without a higher education from obtaining gainful employment.

 

Trump’s unconstitutional tariffs threaten this defining characteristic of American life. In 1819, Chief Justice John Marshall expressed in the case McCulloch v. Maryland the oft-paraphrased truth: “The power to tax involves the power to destroy.” McCulloch was a case about whether the state of Maryland could impose a tax on a national bank created by the federal government. Marshall reasoned that the people of the United States would not have entrusted to one state the authority to tax, and thus the authority to destroy, the actions of the federal government.

 

As Marshall said, “In the legislature of the Union alone, are all represented. The legislature of the Union alone, therefore, can be trusted by the people with the power of controlling measures which concern all, in the confidence that it will not be abused.” Article I, Section 8, Clause 1 of the Constitution gives to Congress alone the power to “lay and collect Taxes, Duties, Imposts and Excises.” “Duties” is the proper term for what we today colloquially call tariffs.

 

The Framers of the Constitution had just finished fighting a war with Great Britain, rallying to the cry of “no taxation without representation.” Naturally, they demanded that this “power to destroy” be vested solely in the people’s representatives where it could only be exercised with support from members of Congress representing a significant portion of the country.

 

The representatives of the people in Congress possess much more intimate knowledge of the needs of their districts than the president and can bring that information to bear on decisions affecting those local interests. The difficulty of the legislative process also facilitates deliberation. As Justice Neil Gorsuch has written — echoing Alexander Hamilton in Federalist No. 73 — to the Framers, the “arduous processes” of lawmaking were “bulwarks of liberty.”

 

When taxes are imposed by presidential fiat, neither this valuable local knowledge nor the deliberative legislative process is available to illuminate decision-making. The result is policy that hurts the American people.

 

Automakers, including those that offer Americans affordable and famously reliable vehicles, have already paid more than $35 billion in tariffs since “liberation day” — more than $400 per family on average. Families bear the burden as companies pass on these costs and are ultimately forced to cut their most affordable vehicles.

 

As unionization and regulation crippled America’s automotive industry, foreign automotive companies filled the gap. In doing so, they provided not only affordable and reliable vehicles, but jobs as well, with manufacturing plants in numerous pro-business American states like that Toyota plant in rural Mississippi that employs 2,400 Americans.

 

Today, motor vehicle and parts production are in recession, down 3.4 percent since March 2025. Vehicle exports are off 20 percent year-over-year, as retaliatory tariffs close off overseas markets for American-assembled cars. New car prices are near all-time highs, used car prices are surging, repair costs are rising, and the Corolla is on the endangered species list. If these unconstitutional tariffs continue, John and Lisa’s fictional story could become a harsh reality for thousands of American families.