US Auto Dealers Face Pressure as Tariff Strategy Shifts

The recent pause in U.S. tariffs raises questions for exporters—and may spell trouble for the traditional business model of American car dealers. Sanne Manders, President of International Revenue at the U.S.-based digital freight forwarder Flexport, shares insight into the winners, losers, and the rise of unconventional smuggling tactics.

Flexport, headquartered in San Francisco, is deeply embedded in global logistics. With real-time data flowing in from international trade routes, the company’s roughly 2,200 employees closely monitor shifting trade patterns. The developments of the past few days, however, stand out even for this seasoned team.

Speaking from Amsterdam, Manders offered exclusive commentary on the recent tariff announcements by former U.S. President Donald Trump, particularly the implications of the newly announced 90-day moratorium.

Trump’s 90-Day Moratorium: Relief or Illusion?

Last Wednesday, Donald Trump declared a 90-day pause on his so-called “reciprocal tariffs.” While this seemed like a step back from the brink, the reality is more nuanced. The 25% tariffs on cars, steel, and aluminum remain intact, and other duties are only being reduced to 10%—not removed entirely.

According to Manders, this shift signals an overdue realization within the Trump administration: their aggressive tariff policy was driving the global economy toward a potential collapse. “They were fighting trade wars with 180 countries simultaneously. Since Napoleon, we’ve known that starting too many battles at once is never a smart strategy,” Manders remarked.

The new approach still intensifies the confrontation with China but offers a partial de-escalation on other fronts. Nonetheless, tariffs are not reverting to pre-conflict levels, and for many U.S. exporters, the relief is minimal.

Car Dealers Under Pressure

One particular concern, Manders notes, is the impact on U.S. auto dealers. Their business model, already strained by supply chain disruptions and shifting consumer preferences, is increasingly incompatible with ongoing trade volatility. Dealers depend heavily on predictable costs and stable supply routes. The persistent tariffs on imported vehicles and parts add another layer of unpredictability—undermining pricing strategies and profit margins.

This uncertainty, Manders warns, could push some players out of the market altogether. “It’s becoming clear that the classic dealership model is no longer sustainable in a global economy shaped by fluctuating tariffs and logistical uncertainty.”

Winners, Losers, and Creative Smugglers

Despite the challenges, Manders sees both winners and losers emerging from the reshuffling of trade policies. Countries not directly targeted by tariffs may gain competitive advantages, while others struggle with rising costs and lost market access.

In a surprising twist, Manders also mentions a new category of players benefitting from the chaos: creative smugglers. Some businesses are reportedly exploiting loopholes in tariff structures, rerouting shipments through third countries or mislabeling goods to avoid higher duties. “We’re seeing new forms of gray-market logistics that blur the line between legal trade and smuggling,” Manders said.

The Road Ahead

While the 90-day pause offers a temporary reprieve, industry experts like Manders remain cautious. The lack of long-term clarity continues to hinder investment decisions, disrupt supply chains, and test the resilience of U.S. exporters.

As the global trade environment grows more complex, Flexport’s real-time insights and adaptive logistics strategies have become essential tools for navigating uncertainty. But even with the best data, companies are left facing a fundamental truth: in a world of erratic trade policies, only the most agile will survive.