A 25% tariff on imported cars is revving up the pressure on European luxury automakers, and high-end buyers in the U.S. could face five-figure price hikes, according to Tim Urquhart, principal automotive analyst at S&P Global Mobility.

President Donald Trump said on April 10 that his administration would enforce a 25% tariff on imported vehicles as part of his broader “reciprocal trade” policy, though he has since suggested he may delay the move.

While some tariffs were delayed for 90 days, this particular levy stayed in place — and it’s hitting the ultra-luxury market hard.

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Ferrari Raises Prices as Other Brands Scramble

Ferrari announced last month that it would increase the prices of nearly all of its models sold in the U.S. by up to 10%. The hike applies even to vehicles ordered months prior, including the newly released Purosangue SUV and the 12 Cilindri grand tourer built in Maranello, Italy.

Urquhart told Business Insider, "It’s very bad news. There’s no getting around that. Ferrari, Bentley, and Rolls-Royce are in a tough spot — they can't absorb a 25% tariff, so that will have to be passed on to customers."

Urquhart added that ultra-luxury brands have more pricing flexibility than mass-market automakers due to their premium sticker prices.

Rolls-Royce, a subsidiary of BMW, is still assessing the situation. Bentley, owned by Volkswagen AG, will continue U.S. imports but hasn’t decided on pricing adjustments. 

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Audi, Jaguar, And Mercedes Adjust U.S. Strategies

Other European automakers are adjusting quickly. Jaguar Land Rover — owned by India's Tata Motors — temporarily halted U.S. shipments to evaluate the impact. 

Audi, a Volkswagen subsidiary, was holding deliveries at U.S. ports as it weighed the next steps, according to Automotive News.

Mercedes-Benz is also reevaluating its lower-end lineup. As reported by Bloomberg, Mercedes may pull some of its entry-level models from the U.S. market due to profitability concerns.

While several automakers posted strong sales gains in March, Porsche reported its best-ever first quarter in the U.S., with Q1 2025 sales jumping 40.6%. The company credited strong demand for the 911 and Macan models for the record growth. 

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Tariffs Create Long-Term Headaches

The broader economic fallout could be steep. A report by Anderson Economic Group estimated that U.S. consumers could pay over $30 billion in added costs from the tariffs in the first year alone. The report also mentioned that the average imported vehicle price could climb by $2,500 to $5,000, with ultra-luxury models rising even more.

Strategy and insight director at Cox Automotive, Philip Nothard, told Business Insider that shifting production to the U.S. to bypass tariffs would be slow and costly. "You can't just suddenly set up production plants, supply chain, and labor overnight," he said.

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This article Ferrari, Rolls-Royce, And Bentley Prices Are About To Soar As 25% Tariff Sends Shockwaves Through U.S. Luxury Car Market originally appeared on Benzinga.com

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