Ever since President Trump announced the details of his tariff plan on April 2, companies across the U.S. have been grappling with the consequences of how their businesses will be affected by them.
Several CEOs have already spoken out about the costs they will face because of the tariffs, including Apple CEO Tim Cook, who said it will cost the company $900 million this quarter alone. Cook has also said Apple will shift all iPhone manufacturing to India, as the phones were previously manufactured in China.
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General Motors also forecasted taking a $5 billion hit this year, while chipmaker Nvidia is taking a $5.5 billion charge to address higher import costs.
Some companies have not spoken out about what tariffs are costing them, but they have announced some changes in the pricing of their products.
Related: Apple CEO sends blunt message on tariffs impact
Ford is one company that’s been forced to take action in response to tariffs, planning price hikes on the Mustang Mach-E electric SUV, Maverick pickup truck, and Bronco Sport SUV by as much as $2,000 on some models. Ford says that despite the increase, it’s still not passing the full brunt of the price hike on to its customers.
Now Toyota (TOYOF)  is the latest company to speak out about the costs it’s facing because of tariffs, and the news is not good.
Toyota president Koji Sato made some painful announcements about tariffs today.
Image source: BMW
Toyota promises it will not make a hasty move
During a press briefing held on Thursday, May 8, Toyota president Koji Sato announced that the company expects tariffs to cost it $1.3 billion for April and May alone.Â
While Toyota manufactures its vehicles in many location around the world, many are made in Japan, where the company originated. Japan is under a 24% tariff that is on pause, but is also subject to Trump’s 25% tax on aluminum, steel, and auto exports, which is currently in effect.
Related: Ford announces desperate move to battle tariffs
Sato did not make any forecasts on the financial future of Toyota, saying that impact would be very difficult to forecast. However, he offered some words of comfort for those who may be worried Toyota vehicles, known for their affordability, will go up in price.
Sato did not address the subject of price hikes directly, saying that Toyota would look at the situation and take “the appropriate action at the appropriate timing.”
“Just because of tariff rising prices, [hasty] is not the type of reaction Toyota is thinking of,” Sato said.
Car prices will have to go up
While Toyota didn’t say anything specific about pricing changes to its vehicles, the likelihood for price increase in the automotive industry as a whole is high.
The least-impacted vehicles will still face a $2,000 tariff and the most impacted will see a tariff of $15,000, according to a recent report from Anderson Economics Group.
Those prices could also vary. Wedbush Securities analyst Dan Ives believes the price of a typical car could go up between $5,000 and $10,000.
While CEO Elon Musk has openly said that Tesla will still be affected by tariffs, the EV company will be the best off in the industry when it comes to them. Teslas are made up of 81% domestic content. Certain Ford, Honda, and Jeep models also rank highly on domestic content, which could mean they are least likely to jump in price.
General Motors, however, is in a bad position. The U.S. car company only makes 45% of vehicles within the U.S., meaning the rest of its cars are fully vulnerable to tariffs.
Related: Tesla robotaxi launch is destined for failure, bullish analyst says
