New Trade Tariffs Are Raising Fleet Costs—Here’s What Construction Businesses Need to Know

parking lot filled with cars
Jonathon Spitz
February 3, 2025

Fleet costs for construction businesses are about to change in a big way. A 25% tariff on vehicle imports from Canada and Mexico, effective February 4, 2025, is expected to drive up prices, disrupt supply chains, and make it harder for small and mid-sized construction companies to maintain or expand their fleets. These new trade tariffs could have long-term financial and operational consequences for businesses that rely on work trucks and vans.

Here’s what’s happening, how it could impact your fleet, and what steps you can take to prepare.

Why Are Fleet Costs Rising?

For decades, automakers in the U.S., Canada, and Mexico have relied on an integrated supply chain to keep production costs down and vehicle availability steady. The new tariffs, however, threaten to break that balance, forcing automakers to either absorb higher costs or pass them along to buyers—including construction companies that depend on fleet vehicles.

Industry analysts estimate that new vehicle prices could increase by approximately $3,000 per unit, making fleet expansion and replacement more expensive. Additionally, delays in vehicle availability could impact businesses needing to replace aging or damaged work trucks.

How the Tariffs Will Impact Construction Fleets

For construction businesses that rely on fleets of light-duty trucks, work vans, and service vehicles, these tariffs could bring a series of challenges:

1. Higher Vehicle Acquisition Costs

  • Businesses looking to lease or purchase new vehicles may face sticker shock as prices rise across the industry.
  • The cost of fleet expansion may push some companies to delay vehicle upgrades, potentially leading to increased maintenance needs.

2. Rising Maintenance and Repair Expenses

  • New trade tariffs will also apply to imported auto parts, increasing the cost of repairs, tires, and replacement components.
  • Supply chain disruptions could create longer wait times for critical parts, keeping vehicles off the road longer than usual.

3. Potential Operational Delays

  • Lead times for new vehicles may increase, making it harder for companies to replace aging fleet assets on schedule.
  • Businesses that rely on just-in-time deliveries for fleet repairs or maintenance may need to adjust expectations and build contingency plans.

How Construction Businesses Can Prepare for New Trade Tariffs

While these changes may create uncertainty, proactive fleet planning can help businesses stay ahead of rising costs and potential delays.

1. Reassess Fleet Budgets

  • Expect higher acquisition and maintenance costs in 2025—adjust fleet budgets accordingly.
  • Consider whether leasing work trucks and vans may be a smarter financial move than purchasing outright.

2. Diversify Vehicle and Parts Suppliers

  • Build relationships with multiple suppliers to increase sourcing flexibility and avoid supply chain bottlenecks.
  • Consider whether domestic suppliers offer competitive pricing or better availability.

3. Prioritize Preventive Maintenance

  • Extend the lifespan of current fleet vehicles by staying ahead of maintenance schedules.
  • Stockpile essential parts (filters, tires, brake components) to minimize downtime due to supply shortages.

4. Stay Engaged with Industry Advocacy

  • Keep up with trade policy updates through construction and fleet management associations.
  • Engage with industry groups that advocate for policies supporting small businesses that rely on fleet vehicles.

The Bottom Line

The new tariffs could significantly impact fleet operations, raising costs and creating delays. But by proactively adjusting budgets, strengthening supplier relationships, and refining maintenance strategies, construction businesses can minimize disruptions and keep their vehicles—and their operations—running smoothly.

For businesses managing fleet vehicles, now is the time to plan ahead.

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