For the past year, despite President Trump's 25% tariffs on imported vehicles and auto parts and 50% tariffs on steel and aluminum, new car prices barely moved. Automakers ate the costs. Dealers held the line. Consumers didn't feel it.

That era just ended.

According to Cox Automotive's first-quarter industry analysis released this week, the total tariff burden on automakers and suppliers in 2025 is estimated at $35 billion. That works out to roughly $3,800 per vehicle that the industry swallowed instead of passing to buyers. But as Cox executive analyst Erin Keating put it bluntly on the firm's March 25 call: "The absorption phase is definitely over."

The industry is now in what Keating calls "pass-through mode." Manufacturers are raising MSRPs on new model year changeovers, trimming features from lower trims to maintain price points, and increasing destination and handling fees — those nonnegotiable line items on your window sticker that quietly crept up throughout 2025. The question, Keating says, is no longer whether prices go up. It's "how much and how fast."

The early data backs this up. Kelley Blue Book reported that the average transaction price for a new vehicle hit $49,353 in February — up 3.4% year over year, well above the 0.9% average annual increase over the past three years. That's not a blip. That's the front edge of a pricing wave that industry analysts expect to accelerate through summer and fall.

And the impact isn't evenly distributed. GM's cheapest model, the Chevy Trax, saw its base price jump $2,000 — a 9.3% increase — for the 2026 model year. Kelley Blue Book estimates that tariffs could add as much as $6,000 to vehicles priced under $40,000, hitting the buyers who can least afford it the hardest.

Meanwhile, the broader economy isn't helping. Gas prices are up 32% compared to this time last year, driven by the conflict in the Middle East. New car loan rates have inched up to 9.8%. And consumer confidence is rattled by headlines about war, inflation, and a softening job market — all colliding at once.

"We are sitting at a unique inflection point where overlapping policy actions, cost pressures, geopolitical uncertainty, and rapidly shifting consumer behavior are all colliding at once," Keating said.

Cox projects U.S. new vehicle sales will fall 2.6% this year to 15.8 million units. But the pain isn't spread evenly across brands. GM is expected to finish Q1 having sold the most vehicles — roughly 624,000 —, but that's down nearly 10% from last year, dragged by weak Cadillac and Buick numbers. Ford is projecting a 9.3% decline. Volkswagen Group is down almost 20%.

The winner? Toyota. Its Q1 sales are expected to be nearly flat year over year, gaining a full percentage point of market share on the strength of the Tacoma and 4Runner. Hyundai-Kia is also holding steady, down just 0.3%.

The clearest consumer trend is a flight to the middle. The cheapest segments — compact SUVs and cars under $40,000 — are losing buyers who can no longer afford them at current rates. The most expensive segments above $70,000 are also softening. What's growing? Midsize SUVs (average price $52,100, up over 15% in sales), midsize trucks ($45,200, up 14%), and midsize cars ($35,200). As Cox's analysts summarized it: "Mid is in."

If you're shopping for a new car, the math is straightforward. Prices are rising, and the industry has no mechanism to bring them back down as long as tariffs remain in place. The hoped-for renegotiation of the U.S.-Mexico-Canada trade agreement hasn't materialized, and if it doesn't, the sourcing rules that govern North American auto manufacturing could shift in ways that push costs even higher.

Locking in a deal sooner rather than later is the move. Incentives are still available — EV incentives in particular are running at more than double the industry average — but those are being used to clear inventory, not to signal long-term price relief. The $35 billion tab from 2025 is now yours. The only question left is how much of it lands on your next window sticker.