JPMorgan warns that the tariffs are going to increase the price of car tires.

Key Takeaways

• Analysts at JPMorgan said that tariffs will likely increase tire prices.
• The Trump administration has imposed steep tariffs on countries that import tires to the U.S., including Thailand and Indonesia.
• Analysts say that it may take some time for consumers to feel the full effect of the tariffs, because companies stockpiled tires before the announcement.

Analysts at JPMorgan say that the Trump administration’s steep tariffs against countries that export tires to the U.S. will likely lead to an increase in tire prices.

Analysts wrote that 63.4% or the tires sold last year in the U.S. came from imports. Four of the top five countries are Thailand (subjected to a tariff of 37%), Indonesia (32%), Vietnam (46%), South Korea (26%) and Thailand.

JPMorgan stated that “we expect U.S. tires to rise, possibly substantially.” Domestic tire manufacturers should see a slight benefit, but face tariffs for importing raw materials like rubber. Shares of Goodyear Tire & Rubber (GT), which has operations in the U.S., Europe, and Asia, sank more than 7% intraday Monday. (Read Investopedia’s live coverage of today’s market action here.)

However, the full effect of price increases is "not likely to be felt immediately," the analysts wrote, since companies stocked up on imported tires before the tariffs were announced.