On the eve of the implementation of the 25% import tariff on cars by Trump, a rush to buy cars has erupted in the U.S. auto market.
Major automakers have unveiled impressive performance reports for the first quarter. General Motors (GM) disclosed that its first-quarter sales surged 17% year-on-year, with retail sales rising 15%. Both Hyundai and Kia set new quarterly sales records, while Ford, Toyota, and Honda reported varying degrees of growth, especially with significant month-on-month increases in March.
Several analysis firms had previously predicted that the new import tariffs announced by the Trump administration prompted a large number of consumers to place orders in advance to avoid potential price hikes. Thomas King, president of the data analytics division at JD Power, stated:
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&#34;The strong performance in March was largely due to consumers accelerating their car purchases, trying to lock in lower prices before the tariffs take effect.&#34;
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<h2>Consumers Rush to Buy Cars</h2>
March 31 is the deadline for U.S. automakers to submit quarterly delivery data. From the disclosed data, popular models generally performed well:
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The Korean-made small SUV Trax from GM saw sales soar by 57%, and this vehicle will be subject to a 25% tariff starting April 3;
Electric models are also racing ahead: Sales of the Blazer and Equinox EV produced in Mexico by GM nearly doubled;
Ford's retail sales rose 5% in the first quarter, with March seeing a year-on-year increase of 19%;
Hyundai's first-quarter deliveries increased by 10% year-on-year, with a single-month increase of 13% in March;
Kia's first-quarter sales rose by 11%, with the Sportage and the new K4 model being particularly popular;
Honda's CR-V grew by 24% in March, with a 9% increase in the first quarter.
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Additionally, Tesla is set to announce its global delivery data this Wednesday. On Tuesday, Eastern Time, the company's stock price rose nearly 7.1% during intraday trading.
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Dealers are also clearly feeling the heat from this buying frenzy. Rhett Ricart, a dealer in Ohio, revealed: &#34;Consumers are showing a strong sense of urgency to 'buy now,' and we have received more inventory in advance to meet the demand.&#34; Currently, dealers across the U.S. have average inventory that can support sales for 60 to 90 days.
The Trump administration is about to impose a 25% tariff on all passenger car imports, which currently account for about half of the U.S. market. Although some models are produced domestically, even those &#34;not imported&#34; cars typically use a large number of non-U.S.-made parts, which may also be subject to tariffs.
Reports have indicated that several major U.S. automakers are urgently lobbying the government to exclude some price-sensitive low-cost parts from the tariff list. According to a study by the Anderson Economic Group, comprehensive tariffs could increase the manufacturing cost of each vehicle by up to $12,000. For mid- to low-end models, which already have limited pricing, this could directly breach profit margins, forcing some models to exit the U.S. market
<h2>Mercedes-Benz May Cut Entry-Level Models</h2>
Bloomberg cites sources familiar with the matter revealing that Mercedes-Benz is considering reducing the entry-level models sold in the U.S., such as the GLA compact SUV (starting at around $40,000). The reason is that these relatively low-priced models, which already have low profit margins, may face losses if they are forced to bear a 25% tariff.
Sources indicate that Mercedes has not yet made a final decision and may change its strategy based on the implementation of the tariffs. They stated that the lack of clear guidance from Washington has left executives feeling frustrated and unsure of how to respond.
The U.S. remains an important market for Mercedes' global business, especially in the high-profit segment of large SUVs. Rather than risk struggling, Mercedes prefers to redirect resources to higher-margin products such as large SUVs and flagship sedans.
Under CEO Ola Källenius, Mercedes has been continuously moving the brand &#34;upward&#34; in recent years, focusing on the production capacity and resource allocation of top models like the S-Class, while gradually diminishing the proportion of compact models in the global market.
Affected by the slowdown in global electric vehicle demand, Mercedes has postponed its timeline for a full transition to electric vehicles. In February of this year, the company reiterated its commitment to continue investing in internal combustion engine models and expects profit margins to be impacted by &#34;intense market competition, trade tensions, and shifts in consumer preferences.&#34;

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With the 25% import tariff on cars about to take effect, the U.S. automotive market has ignited a buying spree. Consumers, worried about a significant increase in car prices, are rushing to place orders before the tariff takes effect, resulting in impressive first-quarter sales for General Motors, Hyundai, Ford, Kia, and others. Additionally, the tariff may directly breach the profit margin for entry-level models, leading Mercedes-Benz to potentially reduce sales of entry-level models in the U.S. and shift towards higher-profit large SUVs and luxury sedans

- Ahead of the implementation of a 25% import tariff on vehicles, the U.S. auto market experienced a surge in sales, with General Motors reporting a 17% year-over-year increase in Q1 sales.  
- Analysts attribute this buying frenzy to consumers rushing to purchase vehicles before potential price hikes due to the new tariffs, with significant sales increases noted across various automakers.  
- The impending tariffs could raise manufacturing costs significantly, prompting some manufacturers, like Mercedes-Benz, to reconsider their entry-level models in the U.S. market.

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Mercedes-Benz Group AG

With tariffs set to take effect, sales of General Motors, Hyundai, Ford, and others are rising, while Mercedes-Benz may cut entry-level models