Kelley Blue Books editor on auto market prices, EVs and uncertainty

Expert weighs in on impact of tariffs with auto industry

n industry expert from Kelley Blue Book explains how potential buyers should approach the market.

FOX 2 - An industry expert from Kelley Blue Book explains how should potential buyers approach the market.

The backstory:

Right now the average price of a new car is around $48,000 while a used car with about 75,000 miles averages about $25,000.

And if you are willing to shop around, you can avoid the dreaded tariffs - but it takes a little work to do it.

It’s hard to predict the future, just ask an auto executive where planning and pricing starts months before production.

It’s also hard for auto experts from Kelley Blue Book to predict how tariffs will affect the price of a new car.

"The prices are on the way up, but it’s not as dramatic right now as many would have thought," said Brian Moody, executive editor at Kelley Blue Book.

For 90 years Kelley Blue Book has been a trusted source for determining the worth of a vehicle new or used. Factors like tariffs play a big role in that determination.

"As far as a direct impact to consumers, we are not really seeing a huge uptick in terms of prices and that’s largely because automakers in some cases are choosing to absorb those costs," he said.

It’s not just the automaker or customers who have to face tariffs – dealers have to figure out how to navigate the murky waters of uncertainty as well.

"Incentives are up right now, so that's one way of hiding the increased cost of a car where the manufacturer and then, therefore the dealer, paid the increased price already."

By "hiding" it means the price increase may simply be moved around. A higher-end model might be a couple thousand more for example. That price might be easier to swallow than if a mid-level or basic trim package increased by the same amount.

Another hiding technique - change what is standard in a vehicle.

"The mid-version doesn’t include one or two little features that it used to, and now it doesn’t," he said.

Still, Moody says there are deals to be had.

"If you were looking for an electric car, I think I would act now," he said.

Tax incentives for EVs may not be around for much longer. And if you want a used electric car - there may be options.

"That’s where the real bargains are," Moody said. "But, if you have to have a new car or want to lease because you are trying the technology out, this is a good time to act on that."

When it comes to used gas-powered vehicles the prices are also going up, but for a different reasons.

"There were new vehicles that were not manufactured during the Covid-era that now result in a lack of used cars - lightly used cars especially, in that market," he said.

If you need a car right now, make sure you do your research before you head to the dealer.

"Automakers and consumers are not at odds with each other," Moody said. "They both want something good for a low price."

Another trend according to Kelley Blue Book, just because you can buy a car online doesn’t mean that’s what’s happening. Moody says pictures and videos can never really replace getting in a car and taking it for a test drive.