A few weeks ago, U.S. government announced that a 25% tariff on imported cars and auto parts would take effect immediately. The goal is to protect U.S. manufacturing and address trade imbalances — but for the automotive leasing industry, the ripple effects are already being felt.

"These tariffs will hit the bottom line of every importer, but their real impact will show up in the monthly bills of end-users — company drivers and fleet customers alike." – Fleet Europe

Higher car prices, higher lease costs

With the new tariffs in place, imported vehicles — or even cars assembled in the U.S. using foreign parts — are getting more expensive. Automakers aren’t absorbing the cost; they're passing it on. Analysts predict price hikes of $2,000–$4,000 per vehicle.

For leasing companies, that’s a big problem. Higher sticker prices mean higher monthly lease payments. The leasing formula is simple: price minus resale value equals monthly cost. If the starting price jumps and resale values become uncertain, lease pricing takes a direct hit.

What it means for the leasing business

Leasing companies are in a tough spot. They’ll need to rethink their portfolios, pricing models, and risk assessments. Here are some ways the industry might respond:

• Shift to local models: Expect a stronger focus on vehicles built in the U.S. or sourced from countries not hit by the tariff.

• Tweak lease terms: Longer leases could help spread out costs and keep monthly payments manageable.

• Revisit risk models: With pricing and resale values in flux, leasing firms may need to reassess how they calculate depreciation.

Supply headaches are coming too

The tariffs don’t just affect prices — they’re disrupting how cars actually get to market.

Some manufacturers have already started pausing or rerouting shipments to reassess their logistics. For leasing companies, this spells potential trouble. Vehicle availability may shrink, delivery timelines might stretch, and popular configurations or trims could suddenly be out of stock.

This isn’t just inconvenient — it makes planning nearly impossible. If your client needs 30 identical fleet cars next month and suddenly only 15 arrive, the leasing contract stalls, operations are disrupted, and trust takes a hit.

On top of that, spare parts are also part of the tariff mix. That means longer repair times and more expensive maintenance — especially for fleets with imported vehicles. If a minor collision or engine issue takes weeks to fix because a part is stuck in customs or just costs too much now, it erodes service levels and customer satisfaction.

Leasing companies used to working with just-in-time delivery systems may find they now need to build buffer stock, rethink supplier relationships, or renegotiate delivery terms — all of which add overhead to an already strained model.

After all, this isn’t just a pricing issue — it’s a business model stress test. The automotive leasing industry will need to get creative, stay flexible, and keep the customer conversation open to ride out this tariff storm.