President Donald Trump has announced a sweeping 25% tariff on all imported vehicles and key auto parts starting on April 3, a move set to reshape the global automotive industry. The tariffs aim to boost domestic manufacturing, sparking significant concern among both automakers and consumers about rising costs and reduced choices.

Analysts predict that these tariffs could add thousands of dollars to the price of new vehicles. The increased costs will likely be passed on to consumers, potentially leading to a substantial decline in US vehicle sales from around 16 million to between 14.5 million and 15 million in coming years. Automakers that heavily rely on imports, such as General Motors and Ford, are expected to face severe impacts, with shares already declining following the announcement.

In a recent report, experts noted that the complexity of the automotive supply chain means that even US manufacturers relying on imported parts would see increased production costs. Consequently, many analysts foresee this leading to higher retail prices for both foreign-made and domestically assembled vehicles.

In response to the new trade climate, Canadian Prime Minister Mark Carney has labeled these tariffs as a “direct attack” on Canada’s economy, announcing upcoming retaliatory measures planned for a response on April 2. Carney emphasized the need to pivot Canada’s economy to reduce dependence on the US market.

Elon Musk, CEO of Tesla, acknowledged the impact of the tariffs on parts sourced internationally but noted that Tesla’s domestic production largely shields the company from the worst of these levies. “Important to note that Tesla is NOT unscathed here,” Musk stated, indicating that price increases due to tariffs would still affect the company.

As the fallout from the tariffs continues, experts and analysts across the automotive industry remain cautiously critical about the long-term implications of such aggressive trade policies. Consumer sentiment and sales figures leading into the spring buying period are likely to reflect the immediate effects of these tariffs on American markets.

For ongoing updates on how these tariffs will unfold, follow our coverage at CBS News.