Understanding Steel and Aluminum Tariffs: Impact on Consumer Prices

Steel and aluminum tariffs have been a fixture of US trade policy since 2018. But despite being in place for years, many people still don't fully understand how a tariff on raw metals affects the price of a car, a can of beer, or a new appliance. The connection isn't always obvious — but it's very real.

This article breaks down how steel and aluminum tariffs work, how costs flow through the economy, and what it actually means for the prices you pay.

The Tariffs: What They Are

The current tariff rates on metal imports into the United States:

• Steel imports: 25% tariff
• Aluminum imports: 10% tariff

These are applied at the point of import — meaning US companies that buy foreign steel or aluminum pay a surcharge of 25% or 10% on top of the market price. The tariffs apply to most countries, including major trading partners like Canada, Mexico, the EU, Japan, and others.

Originally introduced under Section 232 (national security) in 2018, these tariffs have been maintained and expanded. In 2025, remaining exemptions were eliminated, making the tariffs nearly universal.

How Tariff Costs Flow to Consumers

A 25% tariff on steel doesn't mean everything made of steel costs 25% more. The actual consumer impact depends on how much of a product's cost comes from the tariffed material. Here's how it typically works:

Step 1: Raw Material Cost Increases

Domestic steel and aluminum producers raise their prices to match or approach the tariff-inflated import price. This is the intended effect — making domestic production more competitive. But it also means all steel and aluminum costs more, not just imports.

Step 2: Manufacturer Absorption

Manufacturers of steel- and aluminum-intensive products face higher input costs. Some absorb part of the increase to stay competitive, reducing their margins. Others pass costs along. The split depends on competition, market power, and demand elasticity.

Step 3: Consumer Price Impact

The final consumer impact varies enormously by product, depending on how much of the product's cost comes from steel or aluminum:

Real Impact by Product Category

Automobiles: $500–$1,500 per vehicle

A typical car contains about 2,000 pounds of steel and 300 pounds of aluminum. Steel and aluminum represent roughly 5-10% of a vehicle's manufacturing cost. The tariff adds an estimated $500-$1,500 to the price of a new vehicle, depending on the model and how much domestic vs. imported metal is used.

Pickup trucks and SUVs, which use more metal, are on the higher end. Smaller cars and EVs (which use more aluminum) are affected differently.

Appliances: $30–$100 per major appliance

Washing machines, refrigerators, dishwashers, and HVAC systems all use significant amounts of steel. A typical large appliance sees a $30-100 price increase attributable to metal tariffs. Washing machine prices, which were also subject to separate appliance-specific tariffs, saw some of the most visible increases.

Construction: 2-5% increase in steel-intensive projects

Commercial construction uses substantial amounts of structural steel and aluminum. The tariff impact on a construction project depends on how steel-intensive it is. Steel-frame buildings, bridges, and infrastructure projects see the largest percentage impact. For residential construction, the impact is smaller but still measurable in things like metal roofing, HVAC ductwork, and steel framing.

Canned Goods: 1-3 cents per can

Aluminum cans use very little metal per unit, so the per-can tariff impact is small — roughly 1-3 cents. But across billions of cans, the cumulative cost is significant for producers. Most beverage and food companies have absorbed this cost or passed it through as part of broader price increases that they attribute to multiple factors.

Electronics and Appliances: Varies widely

Computers, phones, and consumer electronics contain relatively small amounts of steel and aluminum by weight, but precision components can be affected. The tariff impact per device is typically small ($1-10), though it adds up across product lines.

Beer and Beverages: Near-zero per unit

Despite concerns when tariffs were first announced, the per-can aluminum tariff impact on a six-pack is minimal — a few pennies at most. Beverage price increases are driven far more by other cost factors than aluminum tariffs.

The Domestic Production Effect

Tariffs aren't just a cost — they're also intended to boost domestic production. And in some ways, they've worked:

• US steel production capacity utilization has increased
• Several mills have restarted or expanded operations
• Domestic steel employment has stabilized

However, the steel-consuming industries (manufacturers, construction, auto) employ far more people than steel-producing industries. The tariff's benefit to steel producers must be weighed against its cost to steel consumers — a debate that continues among economists.

Retaliatory Tariffs: The Other Side

Trading partners haven't accepted these tariffs passively. Canada, the EU, and others have imposed retaliatory tariffs on US exports, affecting:

• Agricultural products — bourbon, pork, dairy, and other farm exports face counter-tariffs
• Manufactured goods — motorcycles, boats, and other finished products targeted
• Consumer products — various US consumer goods face higher tariffs in export markets

These retaliatory tariffs affect US exporters and can indirectly impact domestic prices as companies lose export revenue and adjust pricing.

What You Can Do

As a consumer, you can't avoid tariff-driven price increases entirely, but you can make informed decisions:

• Timing major purchases — understand when tariff changes take effect and how quickly they flow through to retail prices
• Comparing domestic vs. import — in some categories, domestic products may offer better value when import tariffs are factored in
• Understanding price attributions — companies sometimes attribute price increases to tariffs when other factors are the primary driver. Be a critical reader of pricing explanations

For businesses, the key is understanding your supply chain's exposure to tariffed materials and exploring whether USMCA or other trade agreement provisions can reduce your tariff burden.

For the broader trade picture, read our 2026 US-Canada Tariff Guide.