Ferrari have stated they are prepared for any tariffs that United States president Donald Trump may impose. The luxury Italian car maker could be negatively affected by Trump’s new tariffs set to be announced on 2 April. This comes after he announced a 30 month halt on all tariffs last month. The proposed tariffs will affect a range of industries worldwide if implemented. With figures reported around 25%, the potential trickle down effect on the customers will be profound if the 47th president of America has his way.
How badly will the proposed tariffs affect the iconic Italian car maker?
With the tariffs focusing on anything made outside of the United States, Ferrari are making sure whatever he decides, they are prepared to adjust and adapt their business model to suit the new financial climate. All of Ferrari’s components are made in house at their factory in Maranello. This means that they can control all aspects of cost and production.
The proposed tariffs would only really be felt by the customer. With Ferrari already planning to increase their prices to accommodate the tariffs, who is really suffering? Because Ferrari, as with all companies doing international sales, will always adjust their prices depending on the importing countries tariffs. Which is standard procedure by the way. All countries around the world impose a small, reasonable tariff on all products imported into the country.
However this tariff rarely exceeds a few percent. Trump’s planned tariffs are out of this world. The long term effect will no doubt lead to companies pulling out of the American market entirely. Some countries like Canada, have already began removing American products from their shelves in response to president Trump’s ridiculous tariffs.
Can Ferrari exist without a foot in the American market? How big is their appeal?
Ferrari’s CEO Benedetto Vigna, stated recently that the company was exploring some countermeasures and scenario planning in an attempt to be ahead of whatever Trump decides. With Ferrari experiencing one of its best years in recent memory regarding profits, the company is focused on the future of the automotive industry while keeping a keen eye on the American market as alot of global production takes place in America and Mexico.
With the emergence of the Electronic Vehicle and alternative fuel power, Ferrari is on track to step into the EV market with their first fully electric car, due to be unveiled later this year. So despite what Trump’s motives are, Ferrari are moving forward with their plans. Some, it must be said, have pointed to Ferrari being one of the few companies exempt from the new tariffs.
While Trump’s reasoning is not entirely clear, economists around the world are pointing out that a tariff does not make a country any richer. In fact, it can make everyday products more expensive. Trump campaigned on the basis that the economy, under Joe Biden was falling apart. But since taking over the White House, the American stock has plummeted because of Trump’s actions and statements. Keep in mind, they haven’t even been imposed yet.
How will Ferrari and the world’s car makers deal with the new tariffs set to be announced 2 April 2025?
Ferrari has always been a leader in the financial return of their products worldwide, even setting records. So the potential impact of the new tariffs might not be in the forefront of their minds, but their phenomenal success in recent years is doubt at risk with Trump in control of the US market. The company has made huge strides forward in the technology of their cars with new propulsion and EV’s being the focus. One must still wonder if they might altogether not bother with the volatile American market, or is the appeal of the dollar to much to leave behind?
