Yesterday was quite an interesting day for my wife and me. We were able to buy a 2025 RAV4 Plug-In Hybrid XSE at Capitol Toyota, but it was a close call -- because of Trump's 25% tariff on imported cars and auto parts that goes into effect next Thursday.
The saga started last Tuesday when Laurel and I were picking up her 2019 RAV4 Hybrid (which isn't a plug-in) after service on it was completed, and she asked a Toyota salesperson if there were any 2025 RAV4 Plug-In's that she could take a look at.
Laurel has liked her car a lot, but would like the plug-in feature. A while back she leased three Chevy Volts in a row before the Volt was discontinued and found that the all-electric range, which was about the same as the RAV4 Plug-In, around 45 miles, meant that she rarely used the gas engine when driving locally. And she's been longing for wireless Apple CarPlay to make it easier to listen to podcasts and audio books.
The salesperson said they had a couple of used RAV4 Plug-In's on the lot but no 2025 models. He told us that typically every new RAV4 Plug-In they get is pre-sold, the demand is s0 high for them.
During the next few days Laurel researched the 2025 RAV4 Plug-In. She wanted the one pictured above, the XSE trim in Wind Chill Pearl with a Midnight Black roof. On Saturday she called Capitol Toyota to ask whether a matching RAV4 she'd seen on their web site was available, or if it had already been sold. After Laurel was told that it was available, she made a 3:30 pm appointment for a test drive.
Since Laurel wasn't planning to buy a car yesterday, I decided to stay home and do some yard work on a pleasingly rainless day. But I contributed to a possible future purchase by getting a CarMax estimate of what our 2019 RAV4 Hybrid was worth, $27,000, and gave a printout to Laurel.
Then the real "fun" began. Laurel texted me at 3:58 pm.
Looks like I will be at the Toyota place for quite a while. They are very busy. The guy came out and said that the White XSE, he claims is still available, is out being test driven right now by someone. So I am waiting for him to get the key for it and now he’s disappeared for a while. A blue XSE RAV4 is being sold at the moment didn’t want that one anyway it looks like I will be here a long time either way.
Now he stopped by with an associate who is going to check to see whether the white one has been sold. If it isn’t sold and it looks like what I want we have to pay for it today. We can’t hold it because they’re going so quickly.
Not long after I got a phone call from Laurel. She said that the person who had driven the white RAV4 Plug-In Hybrid hadn't bought it, so I needed to come to Capitol Toyota ASAP with our Schwab checkbook so we could buy the car ourselves before 8 pm.
I put aside the lawn fertilizer spreader I'd been using, changed my clothes, put the dog in my Subaru Crosstrek (also bought from Capitol), and hurried off to the dealership. When I got there, I learned that the woman who had driven the car we were going to buy had returned to Capitol Toyota and told the salesperson that she wanted to buy "our" car.
After several managers got involved in this controversy, the decision was that whichever customer is holding the keys to a vehicle after a test drive is over has the first right to buy it. That was Laurel, and she wanted to buy the white RAV4. So we lucked out. Barely.
During the rest of our time at the dealership as we discussed accessories (Laurel picked some), extended warranties and such (we declined all of them), our trade-in (Capitol Toyota agreed to match the CarMax offer), and how we'd pay for the car, we learned what a crazy day it had been at Capitol Toyota.
Trump's 25% tariff on imported cars and auto parts had led to a near-panic by people who wanted to buy a Toyota that was on the lot and not subject to the tariff -- which is expected to add thousands of dollars to the price of a new car. A PBS story, "How Trump's steep tariffs on imported vehicles may affect car prices and the auto industry," says:
Some car buyers have been rushing to showrooms across the country this weekend, as automakers brace for Trump’s 25 percent tariffs on vehicles and auto parts made outside the United States. The tariffs kick in on Thursday and could raise some car prices by thousands of dollars.
Walking around the Capitol Toyota showroom with our dog, who had gotten three biscuits from the canine-friendly dealership to tide her over until we could give Mooka her dinner, I could see that most desks were filled with salespeople working with customers. It had been a very busy day at Capitol Toyota.
Ordinarily that'd be good, but in this case it was caused by people like us who desired a new Toyota but didn't want to pay $5,000, or whatever, more for a car after the Trump tariffs go into effect. Trump has said that he "couldn't care less" in automakers raise prices because of the 25% tariff they will have to start paying next Thursday on imported cars and parts, since Trump thinks this will lead people to buy American cars.
He's wrong, as Trump so often is. A CBS News story says:
General Motors, one of the so-called Big Three automakers, along with Stellantis and Ford, is widely expected to be the most exposed to the forthcoming auto tariffs. Headquartered in Detroit, the U.S. car company makes just 45% of vehicles it sells to U.S. customers domestically, leaving 55% of its lineup exposed to tariffs, according to Cox Automotive.
GM, which makes Chevrolet, Buick, GMC and Cadillac vehicles, is heavily invested in Mexico and Canada, where it builds heavy-duty vehicles, according to Cornell's Wheaton.
So General Motors, an American auto company, will be hugely affected by the tariffs, because so many of their vehicles are assembled in Canada and Mexico and include imported parts. The RAV4 Plug-In Hybrid is made in Japan, by the way. A story in The Hill says:
Last month, the average transaction price for a new vehicle was $47,373, up more than 20 percent from just before the COVID-19 pandemic, according to Edmunds.
If the tariffs are fully passed onto consumers, the average auto price on an imported vehicle could jump by $12,500, a sum that could feed into overall inflation, The Associated Press reported.
Cox Automotive, a research firm, estimates that the tariffs will add $6,000 or more to the cost of a typical vehicle assembled in Canada or Mexico.
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