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Auto analysts warn tariffs against Mexico would damage the auto industry

Flickr User zakattak

Auto analysts say new tariffs threatened by President Donald Trump would be damaging to the auto industry - and the overall economy.

President Trump has threatened to slap escalating tariffs on Mexico until that country stops undocumented immigrants from reaching and crossing into the U.S.

Michelle Krebs is an analyst with Autotrader.

"it would be damaging particularly to the American car companies. General Motors and Fiat Chrysler bring full size pickup trucks which are their big cash cows across the border and any time you add cost, that typically means a price increase, and when you increase the price, sales typically go down."

Krebs says the tariffs could also derail the administration's own free trade agreement with Mexico.