Why EV-hating Trump has accidentally driven the final nail in the coffin of gas cars

President Donald Trump’s auto tariffs are meant to boost American manufacturing. Instead, they might just supercharge electric cars. 

Experts say the unintended consequence of a 25 percent tariff on imported cars —taking effect this week — could make EVs cheaper than gas cars.

Most electric cars sold in the US are already built domestically, meaning they won’t be affected by the tariff. 

In contrast, many gas-powered cars are imported, and since automakers can’t build new factories overnight, their prices are set to rise. 

Trump, who has been a vocal critic of electric vehicles, claims his tax policy will push automakers to build more vehicles in the US. 

But experts told DailyMail.com the tariffs could price Americans out of gas-powered cars and accelerate the shift to EVs. 

'You could have a situation where prices rise faster for combustion engine cars then they may for EVs,' Seth Goldstein, a chartered financial analyst for MorningStar, told DailyMail.com. 

'That could potentially bring EVs to price parity with full-gas engines.'

In conversations with multiple car analysts, investors, and sales professionals, one conclusion remains unanimous: car prices will raise. The question is how much. 

But these two major reasons could make tariffs a de-facto environmental policy.  

Loads of EVs and hybrids are built here

For years, automakers have been throwing billions into US assembly plants, but mostly for electric powertrain production. 

BMW has invested $1.7 billion in US production, Ford $11.2 billion, GM $9 billion, and Toyota $13.9 billion – all to build battery-electric, plug-in hybrid, or mild hybrid vehicles. 

This means each company's newly-minted factories will pump out millions of battery-powered cars to American shoppers.  

On March 24, Hyundai announced plans to spend $21 billion on US plants in response to the President's signature economic policy.  

That money, too, will only help produce Hyundai's popular American-made EVs. 

Honda also announced plans to build its mild hybrid Civic in Indiana. Production starts in 2028. 

Tesla, still far and away the largest EV manufacturer by US sales, operates several US-based factories.  

Even before Trump’s latest move, the US was seeing an EV manufacturing boom. In 2019, the country had just two battery and EV factories; today, 34 are pumping out EVs or are under construction. 

In 2025, American factories will churn out 117 models – 28 are full electric and another 33 offer plug-in or hybrid electric vehicles variants. 

That means 52 percent of US-built cars will have trims with some level of electrification, far outpacing consumer appetite. In 2024, only 19.3 percent of American buyers chose a hybrid or EV. 

Meanwhile, American-made gas cars aren't cheap. 

American production facilities are dominated by luxury manufacturers and expensive pickup trucks. 

High-cost brands like Cadillac, Mercedes-Benz, Lincoln, and Buick operate American facilities. Chevy, Ford, and Dodge all produce their uber-expensive full-size pickups in the US.  

A DailyMail.com analysis found the average American-made, gas vehicle's base price is $44,187. 

Only three American-made gas cars have a base price under $25,000: the Toyota Corolla, Hyundai Elantra, and Honda Civic. 

All three currently have low-end lease prices around $200 a month.  

Meanwhile, three of the lowest-cost EVs in the US market are produced in America. 

The Tesla Model 3 boasts a monthly lease price as low as $299, VW's ID.4 is as low as $289, and the Hyundai Ioniq 6 can be had for just $199 a month. 

Plus, all three cars are still eligible for some state and federal tax credits.  

Investors have also tipped their hat at the pricing advantage for electrified carmakers: on March 27, the day after Trump's car tariff announcement, the stock market responded far more positively to American EV makers than their gas competitors. 

Shares of Rivian (8 percent increase), Lucid (3.4 percent), and Tesla (1.6 percent) jumped the day after the tariff announcement, while automakers that rely on foreign-built gas cars saw sharp drops. 

Rivian and Lucid stayed in the green in the past five day trading period after the announcement. GM, Ford, Stellantis, Toyota, and Honda were all deep in the red in the same period.  

That one-week increase added millions more of capital for the American EV producers, while the declines took away millions from automakers that rely on gas cars. 

Still, EV makers are not fully immune to the tariffs. 

China has launched export controls on critical minerals in response to Trump's tariffs that could dwindle US supplies and drive costs up.  

Elon Musk, Tesla's CEO, previously posted on X, his social media company, after the tariff announcement, saying that the company is 'NOT unscathed' by tariffs because of its parts supply. 

Some of America's most popular low-cost EVs – including the Chevy Blazer EV, Ford Mustang Mach-E, and Honda Prologue – are made outside US borders.  

But even international EVs are far less susceptible to higher prices than most other cars currently on American roads because they're less complex. 

Gas cars have more parts... and more problems 

Trump isn’t just taxing imported vehicles – he’s also slapping tariffs on some auto parts.

That’s a much bigger problem for gas-powered cars than for EVs. 

Combustion engines have an average of 2,000 components to function – like pistons, belts, pipes, and valves – and many of which are sourced internationally. 

'The initial auto parts tariffs are specific to "critical engine parts",' Tom Hynes, an automotive insurance industry specialist, told DailyMail.com. 

'[That includes] engines, transmissions, electrical components, and powertrain parts coming from Europe only, not Canada or Mexico.

'The tariffs do not affect parts that are used in the regular maintenance of vehicles; brakes, tires, oil filters, etc.' 

EVs, by contrast, are far simpler than gas cars. Their batteries are essentially just cathodes and circuits, many of which may not be impacted by tariffs, per Hynes' analysis. 

And because EVs require an average of 20 parts, just 1 percent of the number of parts needed in a gas car, they may avoid most tariffs if final assembly happens in the US.

'The question on my mind is "how deep does the tariff go?"' Goldstein said. 

'If you import a cathode for a battery, is that subject to a tariff? Or, if you still assemble the battery pack in the US, are you tariff free?' 

Trump's pricing threat

Behind the scenes, Trump has reportedly been pressuring automakers not to raise prices despite the tariffs, according to the Wall Street Journal. 

Though, President Trump has denied this reporting, saying that he 'couldn’t care less' if automakers raise prices in an interview on NBC News.  

'If you make your car in the United States, you’re going to make a lot of money,' President Trump said on the call with NBC. 

'If you don’t, you’re going to have to probably come to the United States, because if you make your car in the United States, there is no tariff.' 

If Trump’s strategy holds, more than half of new US-built cars – 52 percent – will be hybrid or electric. 

And those EVs – built without the disadvantage of the 25 percent tariff on their retail value – could become cheaper than imported gas cars American consumers have relied on. 

Plus, a growing supply of used EVs are now cheaper than ever. 

This all could lead to more Americans driving electrified cars, experts said.  

'Our thesis for when a country or region will start to see mass market adoption is when EVs are at price parity with a typical gas engine,' Goldstein said.