DETROIT – Michigan’s auto economy took a direct hit in 2025 as tariffs piled billions of dollars of costs onto Detroit automakers and their supply chains — pressure that can ripple into hiring, profit-sharing and investment decisions across a state packed with auto workers.

Now the U.S. Supreme Court has struck down the legal authority used to impose a broad set of tariffs, but the ruling doesn’t guarantee refunds. For Michigan manufacturers, the headline is simple: the tariff bill was real — and what happens next is still uncertain.

Detroit automakers: billions in damage already booked

Automaker earnings and analyst estimates put hard numbers on the impact:

  • General Motors: tariffs cut about $1.1 billion from second-quarter 2025 earnings, and the company projected the full-year hit at $3.5–$4.5 billion.

  • Ford: estimated $800 million in tariff costs in Q2, with roughly $3 billion for 2025.

  • Stellantis: reported multi-billion-dollar losses in 2025, with tariffs among the major cost pressures.

Put together, Detroit automakers faced well over $8 billion in tariff exposure — costs tied to imported components and materials that show up in everything from electronics to batteries and steel.

Why Michigan is more exposed than most states

Michigan is deeply integrated into global automotive supply chains. Even vehicles assembled in North America rely on imported parts and raw materials, so tariffs can hit at multiple points: supplier inputs, sub-assemblies, and finished vehicles.

Michigan businesses paid an estimated $3.8 billion in tariffs in 2025, much of it linked to the auto sector’s import footprint.

What this means for auto workers

When margins tighten by billions, the impact isn’t just corporate accounting. Automakers and suppliers can respond by slowing:

  • capital upgrades and new tooling

  • plant expansion timelines

  • hiring and contractor spend

  • discretionary budgets (including some profit-sharing dynamics)

Michigan communities that depend on assembly, parts manufacturing, logistics and engineering feel those decisions quickly.

Consumers paid too — especially at the dealership

Tariffs are often sold politically as pressure on foreign producers. In practice, research has consistently found that most tariff costs are absorbed domestically — by businesses and households.

Industry estimates suggest tariffs added about $1,200 per vehicle on average in 2025, with higher impacts possible depending on where parts were sourced. For Michigan drivers — in a car-dependent state — higher monthly payments and higher sticker prices are not abstract.

The Supreme Court ruling: relief, but not resolution

The Supreme Court decision struck down the tariff authority at issue, but it did not create an automatic refund process for duties already collected. That means businesses may face a slow, complex path to recover money — if they recover it at all.

Meanwhile, Washington could pursue new tariffs using different legal tools, keeping manufacturers cautious about long-term pricing and investment decisions.

What Happens Next

What the Court did: Struck down the tariff authority used.
Refunds: Not automatic; could require litigation/claims.
New tariffs: Still possible under other statutes.
Michigan takeaway: Automakers and suppliers may stay cautious until policy clarity returns.

Bottom line for Michigan

Tariffs pulled billions out of Detroit automaker earnings in 2025 and added cost pressure for Michigan households. The Supreme Court ruling may reduce long-term uncertainty — but Michigan’s auto economy is still waiting on the most practical answers: refund rules, future trade policy, and whether vehicle prices will ease.