The Unseen Fallout of Tariffs on the Collision Repair Industry

Greg Horn, chief industry relations officer at PartsTrader, explored how tariffs are affecting the automotive industry in unexpected places in a blog post on June 17. 

PartsTrader used sold parts data from its marketplace to track inflationary changes across fenders, hoods, bumper parts, lamps, and wheels. The data revealed that retail prices for OEM parts are rising, but aftermarket parts have not, yet. However, PartsTrader expects aftermarket part prices to begin rising as existing domestic inventory is depleted and replaced by new, tariff-impacted imports. 

According to Horn, approximately 44% of OEM parts used in collision repair are produced outside the United States, and many of these non–USMCA-compliant parts are now subject to tariffs. 

Financial cracks are starting to appear in industry companies. Marelli Holdings, a lighting and internal electronics company and key supplier for Nissan and Stellantis, filed for bankruptcy protection. The company owes a combined $767 million in unsecured debt to the two automakers. 

Detroit Axle is an aftermarket manufacturer of mechanical components often used in collision repair such as control arms, struts, and rack and pinions. The company plans to file for Chapter 11 protection in the coming weeks. 

In a lawsuit filed against the Trump administration in May, the company said it now faces a cumulative 72.5% tariff rate on imports, including: 

• 20% from IEEPA (fentanyl-related tariffs) 

• 25% from Section 232 

• 25% on China-origin auto parts under Section 301 

• 2.5% Most Favored Nation duty 

Additionally, the Port of Los Angeles reported overall cargo shipments were down 20% in May. Horn said that the reduction in import volume, coupled with declining demand for trucking shipments from Canada and Mexico, has led to widespread layoffs and bankruptcies in the freight industry. According to FreightWaves, 12 trucking companies have filed for bankruptcy protection in the past 60 days. 

Read all of Horn’s insights on the PartsTrader website here.