If anything is as American as baseball, hot dogs and apple pie, it's got to be Ford Motor (F).

The legendary car company gave us everything from the Model T to the Mustang to the F-150 pickup truck. During World War II, doing its part in the Arsenal of Democracy, Ford shifted to military production, churning out B-24 bombers.

Few enterprises have such a proud and illustrious past. Unfortunately for long-time Ford shareholders, the company's glory days look very much to be a 20th century story.

Thanks to the explosive popularity of its Explorer SUVs and F-Series trucks, Ford was the most profitable automaker in the world – back in 1999. The stock hit its all-time high that year. It hasn't come close to recovering ever since.

True, the past 20 years have rewarded nimble capital-light companies over plodding, capex-intensive firms like car manufacturers. The global auto market has changed dramatically, too, with greater competition from overseas entrants and the emergence of electric vehicles.

But Ford has also suffered plenty of self-inflicted wounds.

Although the company famously avoided a bailout by the federal government during the Great Recession, it had to mortgage nearly all of its assets in order to stay liquid.

Then there's Ford's long-running issues with manufacturing quality. The company regularly leads all U.S. automakers in total recalls. Not only does that do damage to the brand, but it's a financial headache, as well. In 2024, Ford blew $2 billion in a single quarter on an unexpected spike in warranty costs.

In another wallop, Ford's EV strategy has been a disaster. Declining sales for models such as the F-150 Lightning and Mustang Mach-E led the company's EV division to report a loss of nearly $5 billion in 2025. Ford expects the division to lose another $4 billion to $4.5 billion in 2026.

Adding insult to injury, Ford expects tariffs on steel and aluminum to cut operating income by almost $2 billion annually.

Oh, and the balance sheet is bloated, too. Ford's consumer financing business comprises about 85% of the company's massive debt load. With more than $160 billion in total debt, Ford stock's debt-to-equity ratio stands at 4.54. That's up from 2.84 five years ago, and it tends to make shareholders nervous. Higher and potentially volatile interest costs makes it harder to model future earnings.

The bottom line on Ford stock

As you may have guessed by now, Ford stock has been a big-time market laggard for a very long time.

Over its entire life as a publicly traded company, the consumer discretionary stock generated an annualized total return (price change plus dividends) of just 3.6%. The S&P 500 delivered an annualized total return of 10.6% over the same span.

It's pretty much the same story over the past three-, five-, 10-, and 15-year periods. Ford stock lags the broader market, and by wide margins.

Which brings us to what $1,000 invested in Ford stock two decades ago would be worth today. Spoiler alert: it's ugly.

Have a look at the above chart and you'll see that if you put a grand into Ford 20 years ago, today it would be worth about $2,900. That's an annualized total return of just 5.4%. The same sum invested in an S&P 500 index fund would be worth about $7,300, or 10.5% annualized.

Where does Ford stock go from here? Wall Street is pretty cool on the name, giving it a consensus recommendation of Hold. Of the 22 analysts covering F stock surveyed by S&P Global Market Intelligence, two rate it at Strong Buy, three say Buy, 16 rate it at Hold and one calls it at Strong Sell.

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Few industries are more exposed to the new tariffs being imposed by the Trump administration than the car industry. And for car shoppers, that vulnerability spells higher prices and leaner inventories of cars on dealer lots.

A 25% tariff on imported automobile parts went into effect May 3, joining a 25% tariff on imported cars that went into effect in April. The tariffs will create burdens of at least $2,000 per car, according to Anderson Economic Group, and car buyers are likely soon to see that ripple effect.

Shortly after those tariffs went into effect, it was reported that Ford is raising prices on its cars, including popular models. The reported price hikes are hitting models made in Mexico, with increases up to $2,000 per model — a good example of what many car companies are likely to do if the tariffs are not cancelled or substantially reduced.

Take a look at what you might see at the dealer in the near future.

Is there a truly American car?

To understand the impact of tariffs on car manufacturing, it’s important to realize that there is no such thing as a truly “American” car.

Ford, GM and the U.S. brands under the Stellantis umbrella, such as Jeep, Ram and Dodge, assemble many but not all of their vehicles in U.S. plants. GM, for instance, imports many of its popular Silverado pickup trucks from Mexico. And even cars assembled in, say, Michigan are full of parts and materials that originated outside of the U.S.

Likewise, many Asian and European brands assemble vehicles in the U.S., particularly in plants located in the South. But again, they rely on a complicated mix of domestic and imported parts and materials. Some automotive parts cross a border multiple times before ending up in a fully assembled car that’s ready to hit a dealer’s showroom.

Auto tariffs and their impact

President Donald Trump’s new 25% tariffs on auto imports, including imported parts that don’t comply with the rules of the U.S.-Canada-Mexico trade pact he negotiated in his first term, are already starting to raise prices on cars for sale on lots now, according to anecdotal accounts.

Other tariffs, such as those on imported steel and aluminum — two key car-making materials — are bound to push up manufacturers’ costs, too.

Trump announced the auto tariffs in late March, calling them "permanent." He did, however, make some amendments to the tariffs to create some carve-outs and give businesses time to adjust.

Estimates of how much more cars will cost vary, but the consensus among forecasters is that the impact will be painful.

How much will tariffs raise new car prices?

The staff of The Kiplinger Letter estimates that new car prices will rise by $5,000 to $10,000 in the case of foreign brands, and $3,000 for domestic vehicles.

In an analysis of the car-specific tariffs last month, Edmunds.com head of insights Jessica Caldwell noted that “it’s reasonable to expect that vehicle prices will rise, which presents an added challenge to an industry that is already grappling with ongoing affordability concerns.” Edmunds' data show that the average transaction price of a new vehicle in February was already $47,373, before any tariffs began.

Vehicle availability also figures to worsen, as some key components or materials that used to be imported become prohibitively expensive and manufacturers struggle to line up domestically sourced replacements.

One source at a major automotive supplier tells the Letter that identifying and testing vehicle parts from a new supplier can be a months-long process. And as we witnessed recently with the semiconductor shortage, lacking even one or two components can slow or idle assembly lines, leading to shortages of new cars for sale.

Will used car prices go up because of tariffs?

Price hikes and less inventory may push would-be buyers to look at the used market instead of buying a new car. That in turn spells higher prices and more competition there, too.

Because of the supply chain problems that hampered production of new cars a few years ago, fewer vehicles were leased at the time, and so fewer lightly used, high-quality leased vehicles will be entering the used market now, just as more shoppers will be jockeying for them.

What other car costs could rise with tariffs?

Even if you aren’t planning to buy a car – new or used – what happens on dealer lots is likely to affect you in other ways. For instance, the new tariffs on imported parts are going to push up repair and maintenance costs for all drivers, on everything from body work to routine brake jobs.

Car insurance premiums, which are already way up since the pandemic, figure to rise more, too, as repairing cars gets more expensive. Read more about by how much auto tariffs may raise your car insurance rates.

And even if you don’t own a car, but rent one when you travel, you can expect higher rental rates and fewer options at rental agencies.

Should you buy a car before tariffs have a bigger impact?

The bottom line: If you’re in the market for a car, already own one or ever plan to rent one, you’re going to pay for the new automotive tariffs one way or another.

But before you rush to the dealer before tariffs reverberate, keep in mind it's always best to buy a car because you need it, not because you're afraid the car you want could become too expensive in the future or unavailable altogether.

Even before the new tariffs, prices were already high and inventories were limited, so it paid to be flexible about what to buy — and what features you really prioritize. That will be even more true now as the auto tariffs affect the market.

Don't let fear pressure you into buying. Focus on your personal situation, whether you need a new car, and what you really need from that car.

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Ford is recalling roughly 45,000 cars over an issue with door latches that, when exposed to warm weather, may fail to latch.

The recall, which applies to certain 2015 Ford Fiestas, 2016 Ford Fusions and 2016 Lincoln KMZs, is an expansion of Ford's 2020 recall of the same nature. 

In a November 30 letter to Ford, the  National Highway Traffic Safety Administration said that a component inside the door latches may break, "which can make it difficult to latch, or possibly allow the doors to open while driving.”

The recall is limited to the following locations: Alabama, Arkansas, Arizona, California, Florida, Georgia, Hawaii, Louisiana, Mississippi, New Mexico, Nevada, Oklahoma, Oregon, South Carolina, Texas, Utah, Washington, Puerto Rico, American Samoa, Guam, the Northern Mariana Islands (Saipan), and the U.S. Virgin Islands.

Drivers whose cars are impacted by the malfunction may notice the door failing to latch initially, or a “door ajar” indicator on the dashboard along with potentially increased wind noise.

In 2020, Ford recalled two million vehicles after it reported that the doors, even the ones that were repaired, may not have been fixed properly. 

Vehicle recalls are relatively common. Earlier this year, the NHTSA catalogued vehicle recalls affecting 1.95 million Ford and Honda models. The recalls covered fragile windshield wipers, leaky brake fluid and seat belts that didn't close properly. In November, Toyota recalled 1.85 million cars over a battery issue.

What to do

Ford said it will reach out to any newly impacted vehicle owners beginning the week of December 4. Owners can also contact Ford customer service at 1-866-436-7332, or reach out to NHTSA's Vehicle Safety Hotline at 1-888-327-4236 (TTY 1-800-424-9153), or visit the NHTSA website.

Ford's number for this recall is 20S15.

If you're vehicle is part of the recall, you can take it to a Ford or Lincoln dealer to inspect the door latch date codes, which will be replaced free of charge providing that they fall under the reported time frame.

Owners who previously paid out of pocket for repair may also be entitled to reimbursement.

To see if your car is impacted, either call the hotline or visit the NHTSA website and enter your VIN number.

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The United Auto Workers (UAW) union has reached a tentative agreement on a record contract with Ford after 41 days on strike against Detroit’s Big Three automakers.

"For months we’ve said that record profits mean record contracts, and UAW family, our Stand Up Strike has delivered. What started at three plants at midnight on September 15, has become a national movement,” UAW President Shawn Fain said in a video address. 

“We won things nobody thought possible. Since the strike began, Ford put 50% more on the table than when we walked out," Fain said. "This agreement sets us on a new path to make things right at Ford, at the Big Three and across the auto industry. Together, we are turning the tide for the working class in this country.”

The deal comes after what began as a strike on September 15 at three factories of the Big Three — Ford, General Motors (GM) and Stellantis — grew as more union locals at more plants were called on to strike. As of October 19, the strike had affected production of about 43,000 vehicles per week out of the roughly 145,000 that these automakers produce, according to Cox Automotive.

The proposed contract is pending ratification by Ford's union members but those workers can return to work before this.

Once ratified, the workers will receive an immediate 11% wage increase, which amounts to nearly all of their combined wage increases since 2007, the UAW said. It also includes a reinstatement of benefits such as cost-of-living allowances and a three-year wage progression, which were lost during the Great Recession, as well as a right to strike over plant closures.

“We are pleased to have reached a tentative agreement on a new labor contract with the UAW covering our U.S. operations,” Ford CEO and President Jim Farley said in a statement. “We are focused on restarting the Kentucky truck plant, Michigan assembly plant and Chicago assembly plant, calling 20,000 Ford employees back to work and shipping our full lineup to our customers again.”

Ongoing strikes at GM and Stellantis

Meanwhile, strikes continue at GM and Stellantis.

On October 24 at GM, 5,000 workers from its Arlington, Texas, assembly plant joined the strike, bringing the total number of Big Three union members on strike at the time to more than 45,000.

That walkout came just one day after 6,800 workers walked out and shut down the Sterling Heights, Michigan, assembly plant of Stellantis, and less than two weeks after 8,700 workers walked out and shut down Ford's Louisville, Kentucky truck plant.

According to the UAW website, strike assistance of $500 per week is available, with a bonus check payable the week prior to the Thanksgiving and Christmas holidays.

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We may not be in a recession, but the economy still faces several threats in the coming months, which together figure to act as a drag on growth. How much of a slowdown we get depends largely on how these looming issues play out. To help you understand what is going on with the U.S. economy and what we expect to happen in the future, our highly experienced Kiplinger Letter team will keep you abreast of the latest developments and forecasts (Get a free issue of The Kiplinger Letter or subscribe). You'll get all the latest news first by subscribing, but we will publish many (but not all) of the forecasts a few days afterward online. Here’s the latest… 

First up — the autoworkers strike at the Detroit Big Three: General Motors, Ford and Stellantis. The UAW has struck three production
plants (one from each company) and 38 parts distribution centers for GM and Stellantis so far, and the two sides remain divided on a new wage deal, with the carmakers’ latest offer not enough for the United Auto Workers’ leader. But we know that consumers will suffer when factories go dark. Vehicle inventories were just recovering this year after COVID-era shortages.

The strike at all three firms will seriously crimp auto supplies if it continues. If that happens, look for new car prices to shoot up by 5% or so, and used-car prices to rise even faster, by about 10%. Owners may not be able to service their vehicles at dealers once parts shortages occur.

In the event that a strike lasts for 40 days — as happened at GM in 2019 when workers went out — GDP growth would suffer a bit, about 0.3%. A longer strike may actually cause a recession. If the two sides do reach a last-minute deal it’ll take some hefty pay increases for workers. The economy would dodge a bullet, but already-high car prices would rise even more.

Then, there’s the threat of a government shutdown starting October 1. Congress is nowhere near passing spending bills to fund federal agencies in the new fiscal year. Some House Republicans want sizable spending cuts and say they’ll force a shutdown if they don’t get them. Senate Democrats are saying “No way.” How this gets resolved isn’t clear as of now. Lawmakers might kick the can and OK a temporary funding bill. But that might merely defer an eventual shutdown and a resulting hit to GDP growth.

Following a possible shutdown is the resumption of student loan repayments, which is slated for October. Not every borrower is likely to start repaying, given the order the White House issued that nonpayment can’t be reported to credit rating bureaus. And some borrowers will use income-based plans that limit how much they must pay each month.

Still, the net result will be more people devoting some of their income to debt service after a long hiatus, which means less discretionary spending money. The most serious risk to growth is also a pretty good bet to come to pass: A pullback in consumer spending. Folks are using up pandemic-era savings that built up when the economy was partially shut down and there were fewer things to spend money on, such as travel and dining. Consumers aren’t tapped out just yet. But the average savings rate is down to 3.5%, from a pre-COVID range of 7%-9%.

Low-income borrowers are falling behind on debt payments. Higher-income households are likely to tighten up as their own savings dwindle. Retailers will have to cope with weaker demand. 

All this points to a slower economy as 2024 gets underway.

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As negotiations between major unions and employers stall, a potential strike could have far-reaching consequences. To help you understand what is going on and what we expect to happen in the future, our highly-experienced Kiplinger Letter team will keep you abreast of the latest developments and forecasts (Get a free issue of The Kiplinger Letter or subscribe). You'll get all the latest news first by subscribing, but we will publish many (but not all) of the forecasts a few days afterward online. Here’s the latest...

Keep an eye on these labor disputes with big potential ramifications.

First, union United Auto Workers (UAW) is taking a more aggressive approach to contract negotiations with the Big Three automakers under President Shawn Fain than in previous years. Talks began earlier this month with the goal of reaching a deal before the current one with Ford, GM and Chrysler parent Stellantis expires in September.

Among the union’s demands: increasing wages, ending tiered structures for wages and benefits and reinstating annual cost-of-living adjustments for workers. More important is how the union aims to achieve them.

Under Fain, UAW, which represents 150,000 hourly workers at the Big Three automakers, has refused to name a single automaker on which to initially focus negotiations. Instead, the union has hinted at taking on Ford, GM and Stellantis simultaneously. UAW also says it’s not afraid of a prolonged fight, with $825 million in its strike fund.

During the last round of bargaining in 2019, a breakdown in talks between automakers and the union resulted in a 40-day strike against GM. The automaker claims the strike cost it $3.6 billion that year.

Meanwhile, the Teamsters and UPS averted a possible strike, for now, when they reached a tentative agreement on July 25. Union members need to vote to approve the new contract. Failure to ratify the tentative agreement, which addresses disputes about wages and benefits for part-time employees, could mean another strike threat looms. 

If a strike were to occur, you could expect parcel shipping rates to jump by 10%, as capacity is strained at FedEx and other parcel delivery companies. LTL, or less than truckload, companies should also benefit. They carry smaller freight than traditional truckload companies. Also poised to profit: Intermodal rail, a shift that is already happening as shippers schedule alternatives to UPS. 

Absent a strike, shipping rates will continue at their current low level.

This forecast first appeared in The Kiplinger Letter, which has been running since 1923 and is a collection of concise weekly forecasts on business and economic trends, as well as what to expect from Washington, to help you understand what’s coming up to make the most of your investments and your money. Subscribe to The Kiplinger Letter.

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Millions of Ford and Honda owners have new hassles on top of volatile vehicle costs and gas prices: manufacturer recalls. 

The U.S. National Highway Traffic Safety Administration(NHTSA) has catalogued vehicle recalls affecting 1.95 million Ford and Honda models. The recalls cover fragile windshield wipers, leaky brake fluid and even seat belts that don't close properly. 

Don't despair — even the most popular car models can experience recalls from isolated plant failures or supply chain mixups. Even as the car market shifts to advanced and increasingly popular electric vehicles, manufacturers and car owners will need to keep their eye on the ball for component failures.

See if your daily driver is among the latest manufacturer recalls. Trust us, you don't want to drive a lemon. 

Ford and Honda Recall Issues

Ford F-150 - windshield wipers

Ford has issued a recall notice for 2021 F-150 trucks. There were 222,454 vehicles in this line sold with windshield wipers that could break easily under normal use. This poses a risk to drivers from lowered visibility and higher crash risks in rainy conditions, according to the NHTSA recall report. 

According to the report, the arm attachment of the defective wipers can strip because of ill-fitting components, leading to erratic or slow wipe speed. Only 1% of recalled trucks are estimated to have the defect. 

Ford is offering free windshield wiper arm replacements for affected owners at its dealerships. If you own an affected model, look out for a recall notification by mail between March 27 and March 31.

Ford Fusion, MKZ - brake fluid

Ford is recalling another 1.28 million cars in its Fusion and Lincoln MKZ lines. The NHTSA reports that the affected vehicles could lose brake fluid in certain circumstances. Specific brake hoses can rupture and leak significant amounts of fluid, leading to less responsive brakes, slower deceleration and heightened crash risk. Ford estimates that 2% of the recalled vehicles are affected by the brake hose issue. 

If you own a vehicle from the year 2013 to 2018, monitor the brake fluid indicator light and the brake pedal’s feel. Be on the lookout for a mail recall notice between April 17 and  April 28. Then schedule a free brake jounce hose replacement at a Ford or Lincoln dealership.

The model recall list includes:

• 2013 Fusion - 220,367
• 2014 Fusion - 267,524 
• 2015 Fusion - 188,403
• 2016 Fusion - 280,180
• 2017 Fusion - 211,313 
• 2018 Fusion- 38
• 2013 MKZ - 22,272
• 2014 MKZ - 22,040
• 2015 MKZ - 16,623 
• 2016 MKZ - 20,709
• 2017 MKZ - 31,242
• 2018 MKZ - 15

Honda CR-V, other models - seatbelts

NHTSA reports that Honda is recalling 448,613 models due to seat belt function issues. Certain driver and front passenger seatbelts among the affected models were manufactured improperly and may not latch...

The recalled vehicles include:

• 2017-2020 Honda CR-V
• 2018-2019 Honda Accord
• 2018-2019 Honda Accord Hybrid
• 2018-2020 Honda Odyssey
• 2019-2020 Acura RDX
• 2019 Honda Insight

Owners should look out for a message offering free seat belt assembly replacements, around April 17.

Ford Bronco - rearview camera, steering wheel

Do you own a Bronco with a faulty dashboard screen? Ford has recalled Bronco vehicles with 8-inch SYNC infotainment screens that were involved in a previous recall. NHTSA explains that the malfunctioning screens can continue to show the rearview camera image while driving, heightening the risk of distracted driving. This new recall only includes 1,651 vehicles from the 2021 model year, but 100% of previously recalled Broncos are expected to be affected. 

Ford hasn't registered any crashes related to the issue, but they are issuing a recall out of an abundance of caution. If you're an affected owner you can receive a free software fix remotely or by visiting a dealership. Ford expects all notifications to be mailed by May 5th.

Ford is also recalling 352 other Broncos for steering wheel locking issues. NHTSA announced that the steering wheels on the affected vehicles could lock up due to cracked internal steering components. Should this happen, drivers would be unable to turn the steering wheel while operating the vehicle — a significant risk to drivers and other nearby vehicles. The recall only affects the 2022 Ford Bronco Raptor and 2023 Ford Bronco Wildtrak. 

Ford recommends that affected drivers refrain from operating their vehicle until the steering component issue is towed to a Ford or Lincoln dealership to be fixed. Notification letters go out from March 27 to March 31.

Ford Maverick - taillights

The last recall affects 2,716 Ford Maverick trucks from the 2023 model year. Ford's report explains that these models may have malfunctioning trailer taillights that may not light up properly. Ford identified a missing wiring circuit as the culprit. This issue could decrease vehicle visibility and spike the risk of crashing when night driving.

Ford says it is unaware of any real-world incidents related to the taillight problem, so far. Owners impacted by the recall should receive notices in the mail between March 27 and March 31. Once you get a notice you should contact a dealer who will add a free electrical circuit to restore the connection to the trailer lights.

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EV car sales have skyrocketed in the U.S., even as overall US car sales remained flat. It’s a trend that's impossible to ignore — that the future of cars is electric. According to Cox Automotive, in Q2 2024, sales of electric vehicles accounted for 8% of the total automotive sales, up from 7.2% during the same period last year. Much of that growth is thanks to California, as shown in the graph below.

Sales are forecasted to keep increasing, as will charging infrastructure. The electric vehicle market is set to surpass 691.56 billion by 2028, according to a recent report published by Extrapolate. And Goldman Sachs Research forecasts that electric vehicles will make up half of all global car sales by 2035. In only eight years, there will be more public EV chargers than gas stations in the U.S., according to Bloomberg.

This massive increase in sales interest can be attributed to several factors including the cost of fuel, as gas prices remain relatively high, improved EV performance, more choice of cars, and of course, government incentives. The federal EV tax credit) — part of the Inflation Reduction Act that passed in August 2022 — is designed to encourage the use of “clean” vehicles. The act includes a $7,500 credit for people buying electric cars and extends the tax credit to 2032. The exact amount of the credit is based on a calculation that considers factors like the vehicle’s sourcing and assembly. Many states and public utilities also offer incentives for EVs and home charging systems.

An EV/electric vehicle does everything a gasoline car does — gets you around, operates the air conditioning, plays music — but uses stored battery power. Unlike hybrid cars, EVs do not burn any gasoline. Most people charge their vehicles at home, and many can achieve a "full tank" of charge overnight.

Read on to find out the 10 most popular electric vehicles sold in the U.S. over the past quarter. We've noted the range, the average starting price and if the vehicle is eligible for the $7,500 point-of-sale tax credit (now taken at the dealership). If you are interested in one of the models that des not qualify for the tax credit, remember that you can still get this advantage through the EV lease tax-credit loophole. We also include the "miles per gallon electric," or MPGe, which estimates how many miles you could travel in an EV on the equivalent energy use of one gallon of gas. 

Units Sold: 101,301

Starting at: $44,630

Amount of available tax credit off starting price: $7,500 (for models under $80,000 MSRP)

EPA Fuel Economy MPGe (max): 117

EPA Range (max): 310 miles 

With one of the best charging networks, high performance, and a minimal but luxurious interior, the Tesla Model Y is hugely popular. The Model Y became the top-selling car globally in 2023. That's the best-selling car — period — not just the best-selling EV. The car also won a "Top Safety Pick+" (the highest designation) for safety from the Insurance Institute for Highway Safety (IIHS).

Units Sold: 42,710

Starting at: $40,630

Amount of available tax credit off starting price: $7,500 for Performance model only

EPA Fuel Economy MPGe (max): 132

EPA Range (max): 342 miles 

The Tesla Model 3 was originally released to be a more affordable option for buyers. Even with the "cheapest" price tag, the Tesla 3 still packs a punch. Sales of this entry-level Tesla are down 26% year-over-year for the second quarter of 2024. Some of the headwinds stem from competition from other EVs entering the market and consumers giving hybrid cars a second look.

Units Sold: 12,645

Starting at: $39,995

Amount of available tax credit off starting price: $0

EPA Fuel Economy MPGe (max): 111

EPA Range (max): 320 miles 

The Mustang Mach-E is the first out of two Fords on our list. The Mach-E doesn't fit the "sporty" appeal of other past Mustang releases, but underneath, this EV packs up to 480 horsepower still giving you that classic Mustang feel when you put your foot down. Best yet? Under an agreement with Tesla in 2023, Ford EVs may charge up at Tesla Supercharger stations, though drivers must order an adapter from Ford.

Units Sold: 11,906

Starting at:  $39,950 

Amount of available tax credit off starting price: Currently $0, but once these cars roll off the new manufacturing facility in Georgia later in 2024, they will be eligible for $7,500.

EPA Fuel Economy MPGe (max): 114

EPA Range (max): 303 miles 

The Hyundai IONIQ 5 has one of the most novel designs of any vehicle on this list. It is one of the first EVs to offer vehicle-to-load (V2L), or the ability to tap the car's big battery for charging appliances. You may want to power your cellphone, coffee maker or refrigerator in the event of a hurricane or other disaster, or you may just want to take the car glamping. The car is rated a "Top Safety Pick+" by IIHS. The Hyundai Ioniq 5 also has one of the fastest charging speeds of any EV, juicing up from 10% to 80% in under 18 minutes at a level 3 (DC) 350 kW charger. 

Units Sold: 8,755

Starting at: $60,990

Amount of available tax credit off starting price: $0

EPA Fuel Economy MPGe (max): Not available

EPA Range (max): 340 miles, or 470 miles with optional range extender pack

You either love the futuristic design of this truck, or you'd prefer a more traditional model like the Ford F-150 Lightning (number seven on our list). The Cybertruck has V2L capability, meaning you can charge appliances at any of the 110 or 220-volt outlets.  The back seats in the Cybertruck have a touchscreen. The truck also has a suspension system that adjusts automatically to terrain and other advanced-tech features.

Units Sold: 8,137

Starting at:  $69,900

Amount of available tax credit off starting price: $3,750 for models with an MSRP under $80,000

EPA Fuel Economy MPGe (max): 73

EPA Range (max): 400

This three-row electric powerhouse is Rivian's cool answer to the minivan. As you would expect from a family car, it has excellent safety features, garnering a "Top Safety Pick" award from IIHS. With four different battery sizes and multiple trim levels, there are 20 variations of this SUV, so do your research to get the exact car you want. As InsideEvs notes, this car's efficiency is a surprise; the largest battery pack, which should guzzle the most electricity per mile driven, is, in fact, the most efficient one. Rivian owners may access part of the Tesla Supercharger network using a special adapter.

Units Sold: 7,902

Starting at: $62,995

Amount of available tax credit off starting price: $7,500 for models with MSRP under $80,000

EPA Fuel Economy MPGe (max): 70

EPA Range (max): 320 miles 

The F-150 Lightning wasn't the first electric truck to hit the road, but after its reveal in 2021, Ford received over 200,000 reservations. Since then, it has continued to be the top-selling EV truck. Under an agreement with Tesla in 2023, Ford EVs may charge up at Tesla Supercharger stations, though drivers must order an adapter from Ford. One of the downsides of this truck is its lackluster safety rating.

Units Sold: 7,571

Starting at: $43,070 

Amount of available tax credit off starting price: $0

EPA Fuel Economy MPGe (max): 119

EPA Range (max): 252 miles  

Though several reviews for this car have been "meh," it is picking up in popularity, with a 286% rise in year-over-year Q2 sales, according to Kelly Blue Book data. Toyota ramped up hybrid cars and delayed a vigorous adoption of a full-EV lineup. This strategy looked pretty smart when EV sales cooled in the last two quarters, but the company has some catching up to do now that EV sales are back on track.

Toyota's BZ4X sits within a crowded lineup of electric SUVs and crossovers. Compare this model to the Tesla Model Y, the Volkswagen iD.4, the Hyundai Ioniq 5 the Subaru Solterra and the Kia EV6.

Units Sold: 7,294

Starting at: $57,195

Amount of available tax credit off starting price: $7,500 off models with an MSRP below $80,000

EPA Fuel Economy MPGe (max): 88

EPA Range (max): 308

This SUV from Cadillac comes with 500 horsepower and interior luxury called "opulent" in a review by Inside Hook.  The car also offers a quiet ride, excellent seat comfort and excellent range. The one downside according to InsideEVs is that its DC fast charging time is a bit slower than the Tesla Model Y and some other competitors. 

Units Sold: 7,066

Starting at: $52,200 

Amount of available tax credit off starting price: $0

EPA Fuel Economy MPGe (max): 120 (for eDrive 35)

EPA Range (max): 318

The BMW i4 earned a perfect score from Car and Driver editors, who praised the car's comfort, sporty driving and traditional design. If you want an EV wrapped in a classic "normal" coupe style, this is a great option.

The new EV tax credit, while generally welcomed by some consumers and lawmakers, has caused confusion, in part because of new rules surrounding electric vehicle price limits, and for manufacturing, sourcing, and assembly that make some vehicles ineligible for the credit. So, there are ongoing questions about which vehicles qualify and whether certain electric vehicle models are considered cars or SUVs for purposes of the tax credit.

SUV Versus Car: EV Price Limits

Late last year, the IRS released guidance to help consumers determine which EVs were eligible for the new tax credit. That guidance used a particular federal vehicle classification standard to determine whether a certain electric vehicle is a car or a SUV. That distinction is important because under the Inflation Reduction Act (IRA), the EV tax credit manufacturer’s suggested retail price (MSRP) limit is different for cars as opposed to SUV, vans, and pickup trucks. To be eligible for the EV tax credit, cars must have an MSRP under $55,000, while eligible vans, pickup trucks, and SUVs can’t have an MSRP of more than $80,000.

To address ongoing confusion around vehicle classifications and price limits, the Treasury Department and the IRS released new guidance in February. That guidance uses different criteria, based on the Environmental Protection Agency’s (EPA) Fuel Economy Labeling Standard, to determine whether a vehicle is a car or a SUV. For automakers and consumers, that essentially means that several crossover vehicles that were apparently ineligible for the EV tax credit earlier this year, could now be eligible.

Additionally, the new guidance is retroactive to January 1, 2023. So, if you took possession of your EV in January of this year, you can use this guidance to determine whether the vehicle you purchased is eligible for the tax credit.

Does Tesla Model Y Qualify for the EV Tax Credit?

The Tesla Model Y, Ford Mustang Mach-E, and Cadillac Lyriq, are examples of popular electric vehicles that qualify as SUVs for purposes of the EV tax credit, according to the IRS.

However, it’s important to note that the guidance coming from the agency on the 2023 EV tax credit can change frequently, so if you are in the market for an EV, and want to claim the credit, keep an eye on the IRS’ list of qualifying vehicles for 2023 and after. You can also search the vehicle identification number (VIN) of the EV that you’re interested in on the Department of Energy's Alternative Fuels Data Center website. 

The IRS has also updated its frequently asked questions fact sheet on the EV tax credit.

EV Tax Credit Concerns 

The vehicle classification changes come as some industry automakers, including Ford and Tesla, had already reduced prices on some of their electric vehicle models to make them eligible for the tax credit. (Some of those prices, e.g., like the price of the Tesla Model Y, are reportedly inching back up.) And while making more EVs eligible for the credit is mostly good news for some consumers, there’s still a lot of wrangling in Congress, and in international circles, over which electric vehicles should be eligible for the tax credit, and why. 

For example, South Korea, the EU, and Sweden have expressed concerns about the final assembly requirements in the Inflation Reduction Act. And Sen. Joe Manchin (D-WV), who was a proponent of the Inflation Reduction Act, recently proposed legislation to halt implementation of the EV tax credit. Manchin’s view is that the IRS is making the full $7,500 tax credit available for vehicles and manufacturers that haven’t met all of the requirements in the Inflation Reduction Act.

So what does all of this mean for you? The controversy surrounding the new EV tax credit and the increasingly complicated rules for claiming the EV credit, mean that new information will continue to flow from the Treasury Department and the IRS. For example, much anticipated guidance on manufacturing and sourcing requirements for the credit was released March 31. So, if you’re in the market for an EV and hope to claim the tax credit for 2023, stay tuned.

As the popularity of electric vehicles grows, will the gas engine become an endangered species? 

The short answer is no, or at least not in the next couple of decades. There are just too many gas-engine cars on the road, with after-market suppliers and local garages supporting the repair of internal combustion engines. 

Even so, your next new car could be an EV. You may be wondering, is now the time to buy an electric vehicle? Fiat Chrysler gave motorheads a stir in mid August when it announced that it will shut down production of its gas-powered Dodge Charger and Challenger at the end of 2023—and hopes to produce its electric muscle car, the Dodge Charger Daytona SRT Concept. General Motors announced last year that it plans to offer a fully electric fleet by 2035. And Ford, the last of the Big Three automakers, has pledged that 40% of its global sales will be EVs by 2030. 

Recent regulation out of California is also spelling impending doom of the IC engine. The California Air Resources Board approved a plan to reduce air pollution by requiring 100% of new cars sold in 2035 to be zero-emissions vehicles, including plug-in hybrids. The regulation will take effect in phases, so starting in 2026, for example, only 35% of new vehicles must be considered zero-emission, with this percentage increasing to 68% by 2030 and 100% by 2035. However, the key language in the CARB regulation is the phrase “including plug-in hybrids,” meaning the IC engine still has road to run. 

A plug-in hybrid has a battery and an electric motor, but it also has an internal combustion drivetrain. Once you drive past the vehicle’s electric range of, say, 30 miles, the gas engine kicks in. So even in California—and a number of other states that are likely to adopt its emission rules—you could buy a brand-new car that has an internal combustion engine in it in 2036.

Karl Brauer, executive analyst at iSeeCars.com, also cites the limits on precious metals needed for batteries. “There simply isn’t enough lithium out there, which suggests we are going to run out. It’s the same conversation of oil being a finite resource,” he says. But a battery breakthrough is possible. The World Economic Forum says EV-battery recycling could help cover the lithium demand, as could better extracting methods. Scientists are also working on alternatives such as sodium-ion batteries.

There is widespread consensus that the future, at least when it comes to what we drive, is electric. Carmakers have been falling all over each other with promised dates by which some or all of their offerings will be electric, or at least electrified in some way. But when is that future for you? Should you buy an electric now? A number of vehicles either for sale or coming to market in 2022 promise to shake things up. They’re neither tiny nor dizzyingly expensive, and they might tip the scales for some to try electric.

For the people who would rather drink battery acid than give up their internal combustion engine vehicles, you can relax. We are, as one auto observer put it, living in a “golden age of choice”: Massively powerful muscle cars and electric vehicles with record-setting range and efficiency are both on the market. “People who are thinking, ‘Oh boy, I better go get my gas-powered V8 car now, or else tomorrow or next year I walk’—no, that’s not true,” says Matt Degen, an editor at Kelley Blue Book. “Gasoline combustion vehicles are going to be with us for a while, probably even decades.”

What’s a Battery Electric Vehicle?

This is a good time for a note about terminology: An electric car is technically known as a battery electric vehicle (BEV), or sometimes an all-electric vehicle. That is, everything it does—move around, operate the air conditioning, play music—comes from stored battery power. There’s no gasoline burned by the vehicle, period. Hybrids (think Prius) don’t qualify, nor do their descendants, plug-in hybrid vehicles (PHEVs), even though some can travel significant distances using electricity alone. All of the vehicles we’re looking at here are BEVs.

But before we get into the nitty gritty of the new EVs that are likely to satisfy expectations of “electric car,” please allow us to gush for a moment about the Ford F-150 Lightning we saw at the Washington, D.C. car show this winter. This all-electric pickup truck is a watershed vehicle in many ways, but perhaps most importantly, a truck, which is the type of vehicle Americans have indicated (through sales) that they want. No surprise that it’s, basically, sold out. Ford isn’t taking new reservations so that it can fulfill orders for people who signed up earlier.

“It’s a huge deal,” says Jonathan Elfalan, director of vehicle testing for Edmunds. “Number one, the F-150 is the best-selling vehicle inAmerica. Plus, Ford is making the F-150 Lighting start at just under $40,000. And Ford is set up to produce this vehicle, in volume, in America.” Notably, The New Yorker magazine recently ran a long feature on the debut of the Lightning, which, given that publication’s historical lack of interest in things automotive, was perhaps a watershed moment of its own. The Lightning shares the same basic body shape as its internal-combustion peers, and where this matters most is that accessories for the cab and bed (say, a cap or a tool box) designed for the whole line will fit here, too. That it looks very similar to other Ford trucks will probably be reassuring as well. There’s just enough flash (like the blocked-out grille and distinctive LED headlights) to indicate that this is something a bit different.

Go Frunking with Your Lightning

But, of course, the vehicle is loaded with electric-specific features, like 120-volt outlets (and available 240-volt outlets) that can flowserious power to tools, accessories—even your house. Some of those plugs are up front in the so-called frunk, a front storage compartment that takes advantage of the fact that an electric vehicle’s powertrain is shaped differently, generally encroaching less on the front of the vehicle. The Lighting’s frunk, which makes the Lightning perhaps the world’s most expensive cooler, has a drain, which means that, yes, you can fill the frunk with ice and beverages and go tailgating (or is that frunking?).

This feature is also found on another Ford product, the Ford Mustang Mach-E. As with the F-150 Lightning, Ford is trading on brand recognition by applying the Mustang name to a four-door, hatchback SUV, which really doesn’t share anything with the legacy internal combustion Mustang it borrowed the name from other than styling and rapid acceleration. Where the Mach-E differs from the Lightning, significantly, is that these models are actually available, right now, in dealer inventories (although you can order one to your specification, too).

The Mach-E is one of several vehicles either just on the market (see the Volkswagen ID.4) or about to arrive that are gunning for what is, let’s face it, the industry standard for EVs: the SUV-scale Tesla Model Y, which was the EV that posted the most new registrations between January and October 2021, according to data from Experian. So we’re sure it will warm some hearts in Dearborn, Mich., to know that Jeff Cannon, of White Plains, N.Y., cross-shopped the Mach-E against the Tesla Model Y recently and picked the Ford. “The drive of the Mustang was much more comfortable—a smoother ride than the Tesla. It also had more features than the Tesla.” Another selling point for Cannon and his husband, Ed Baklor (who has a Tesla 3), was that for the Mustang, a federal tax credit was still available.

This EV tax credit is worth up to $7,500 and is available on battery electric vehicles and many plug-in hybrids. But it’s an odd duck, with restrictions on both the taxpayer looking to claim it (the amount it’s worth can’t exceed what you owe in taxes) and the vehicle’s manufacturer (once a carmaker has sold more than 200,000 eligible vehicles, the credit phases out). For a model-by-model list of credits, see https://fueleconomy.gov/feg/taxevb.shtml.

Both Tesla and GM have sold enough EVs that the federal credit is no longer available for their vehicles. Some states offer their own credits and incentives, including on the home chargers that are a necessity for EV ownership. Check out https://plugstar.com/tools/incentives for details.

Cue the New Models

Several of 2022’s notable offerings are coming from Hyundai, Kia, Subaru and Toyota. Essentially, the cars are four iterations of two basic vehicles (or “platforms,” to use the industry parlance), but all will have the federal tax credit available at their debut. As time passes and the brands begin to use up their credits, the shrewd shopper might be able to claim the credit by buying one of these cousin cars from the other manufacturer, but that point is unlikely to come this year.

So, the vehicle pairs: From Subaru and Toyota, we’ll be getting the Subaru Solterra and the Toyota bZ4X. From Hyundai and Kia, the Ioniq 5 and the EV6. All four are SUVs that are roomier than prior, smaller electric offerings, such as the Kia Niro and Hyundai Kona Electric. But the value-conscious shopper should pay attention to what, exactly, becomes available when.

“Hyundai and Kia, because they are regular car manufacturers, understand that they need a base model, but they can also offer a premium model to compete with Tesla’s Model Y directly,” explains Jonathan Elfalan, director of vehicle testing for Edmunds. “So while they are bringing their premium models out first to get the early adopters to spend all their money on the most-expensive models, soon after they’re going to be introducing the cheaper models with smaller batteries so that everyone has an opportunity to buy an EV.”

The Ioniq 5 and the EV6 represent electric-first thinking that moves beyond these carmakers’ earlier offerings, which were inhabitants of the small-and-cheap niche of the electric market of the past decade. What that means to the car shopper is that the electric bits, such as the battery and motors, have been put where they make the most sense, not adapted to a platform meant to house an internal combustion engine, a transmission and a fuel tank. You get not just better numbers for, say, range and acceleration, but also more interior space and better handling.

The Ioniq 5 and the EV6 also reflect the same-but-different relationship of their corporate parents: many shared components but decidedly different styling. Where the Kia has the expected futuristic/aggressive look of an EV, the Ioniq 5 harks back to the 1980s with design cues from Hyundai’s first mass-produced car, the Pony, itself the work of famous Italian car designer Giorgetto Giugiaro. People who remember Hyundai’s trouble-ridden debut in North America back in the ’80s might question this association, but remember, it’s just the aesthetics.

Subaru and Toyota’s collaboration is significant as well for being the first mass-market electric from either brand. Toyota has been somewhat late to the EV rush, which has perplexed some, given its dominance in the hybrid market. Don’t fret, says KBB’s Degen. “Toyota has been, let’s say, a little bit slower to get on board with all EVs. But boy, that is changing quickly. Toyota takes its time to make sure it gets things right.”

The name bZ4X apparently reflects being “beyond zero” in emissions, and the 4 is an invocation of the similarly sized (and popular) RAV-4. Future Toyota electrics will build on that naming convention. Two versions of this compact EV are planned: one front-wheel drive (with a manufacturer-estimated 250 miles of range) and one with all-wheel drive (no range yet published).

The Subaru twin, the Solterra, will be all-wheel drive only, and Subaru is emphasizing its off-road capabilities, in keeping with the company’s outdoorsy vibe. The Solterra will have 8.3 inches of ground clearance, and where the bZ4x’s front fenders will have glossy paint, the Solterra will have matte plastic for greater scratch resistance. That will be good for pressing forward through the thorny underbrush—or the Trader’s Joe’s parking lot. The Solterra has a manufacturer-estimated range (it isn’t yet EPA certified) of 220 miles, and we’ll bet that’s roughly what the all-wheel-drive bZ4X will come in with, too.

The Charging Issue

If we were writing about “regular” cars, we wouldn’t wrap up with a section on where to buy fuel, right? But recharging remains the Achilles’ heel of electric vehicle ownership. Progress is being made on many fronts: Longer vehicle ranges, faster charging protocols and more places to recharge are closing the gap on the dead simple process of going to the gas station. Even so, says Edmunds’s Elfalan, “for most people, home charging is going to be the default solution. And by the time they become accustomed to that routine, they’re never going to want to go to a gas station again. It’s just too convenient to top up overnight at home.”

Home charging requires some planning, though. The power needs of an electric are such that connecting to a 110-volt plug as if you were recharging, say, your leaf blower isn’t going to cut it for most people. You’ll likely want to have a dedicated 220-volt line, and then, hooked up to that, a recharger unit from either your carmaker or an aftermarket manufacturer.

The cost of the rechargers can range from $300 to $700. But remember, there are generous subsidies available for these. While they waited for their Tesla Y to be delivered, my next-door neighbors in a Maryland suburb of Washington, D.C., Adam and Gabby Reid, went ahead and installed a fast charger. “There’s a Maryland incentive, there’s a Pepco [utility] one, and there’s a federal incentive, so the cost of buying and installing a charger is going to come out to zero, which is kind of incredible,” says Adam.

Home charging also allows for the possibility of using your own rooftop solar panels to charge, which can potentially reduce your car’s energy cost to zero. EVs also have lower maintenance costs, so, depending on how many years you own it, along with several other variables, an EV can cost you significantly less than a gas car. Research by Consumer Reports shows thousands of dollars in savings, enough in some cases to make up for EVs’ generally higher up-front cost.

EVs often serve as a household’s second vehicle, minimizing range concerns. But we are a road-tripping people. If you’re going to leave the safety of a circle defined by your vehicle’s range divided by two (and leave some margin for error, please), you’re going to need to confront the public charging network. By one count, in January 2022, there were about 113,600 charging outlets in the country. But roughly one-third are in California.

Further complication: Access to the system is more or less bifurcated, with Tesla owners having access to the proprietary Supercharger network that others do not. And within the non-Tesla world, there’s a range of vendors selling subscriptions (the truly thrifty can hunt out locations where charging is free). Websites and apps such as Plugshare (which are frequently built into the navigation systems of BEVs) can help, but finding a convenient, available charge can still be a hassle. The term of art for this is range anxiety.

Over the course of 2021, a global microchip shortage triggered supply shocks affecting a wide array of products, from smartphones to home appliances. But no industry has taken a bigger hit than the auto industry: In August 2021, for example, reduced inventory at Ford dealerships led to a 33% decline in U.S. sales compared with the previous year.

With increased demand amid the shortages, many car buyers are paying top dollar for their new or used vehicle—and sometimes for the car loan, too. If you’re looking to purchase and finance a car before supplies return to normal, do some comparison shopping to be sure you’re not overpaying for your vehicle or the loan.

Stick to a budget. “Car buying is emotional,” says Matt Degen, an editor at auto­motive website Kelley Blue Book. Many first-time buyers are eager to go for flashy models or slick features, at prices that may not fit their budget.

You’ll save money buying a used car, even though loan rates are a little higher for used vehicles. Recently, rates averaged 4.2% for a four-year new-car loan and 4.8% for a four-year used-car loan, according to Bankrate.com.

However, when you buy a used car, you run the risk that the vehicle will need major repairs or have maintenance issues. For more peace of mind, Degen encourages buyers to consider certified pre-owned (CPO) vehicles, which come with a manufacturer’s warranty.

If you’re choosing a new car, decide whether you want to buy or lease the vehicle. Buying is smart if you plan to hold on to the car until the loan is paid off and beyond (or if you plan to pay cash). Leasing often makes sense if you tend to trade in a car before you’ve paid off the loan. With a lease, you are paying mainly for the car’s depreciation over the term of the lease (typically three years). Monthly payments are usually lower than they are for a car loan, and repairs (but not maintenance) are covered as long as the warranty lasts. Be sure to negotiate just as hard for the price of a leased car (called the capitalized cost in leasing jargon) as you would for a purchase.

Even if the loan or lease payments fit your budget, be sure you understand how much interest you’re paying overall and for how long. The dealer’s finance and insurance office can extend a loan or manipulate a lease to lower your monthly payments, but that may not be best for your overall financial prospects.

Budget for costs beyond the monthly payments, such as repairs, maintenance, fuel and insurance. You can find a 5-Year Cost to Own tool at www.kbb.com that estimates those costs, depreciation and more.

Dealer or bank? One of the main decisions car buyers make is whether to get financing at the dealership or from a bank or credit union.

Borrowing through the dealership allows you to take advantage of any manufacturer incentives, such as low- or no-interest financing or cash-back offers. Especially at the end of the model year, manufacturers sometimes sweeten the deal with incentives on less-popular vehicles. But Degen warns that you may not be eligible for the same deal a friend got on the same car. And manufacturers haven’t needed incentives recently to move cars off their lots.

Major used-car sellers, such as CarMax and Carvana, also offer loans. CarMax, for example, aggregates multiple financing sources on its website so that buyers can compare deals. Carvana includes a tool on its website that lets you pre-qualify for a loan so that you can explore various vehicle financing options.

You may get a better deal on a loan from your bank or credit union. And borrowing from your bank or credit union can alleviate the pressure of purchasing and financing a car from the same place.

Chip stocks are garnering their fair share of attention in 2021, as a global semiconductor shortage affects all aspects of our daily lives.

The reality is that our modern world runs on chips, and they provide the backbone to everything we do – from working on computers to talking on phones and, increasingly, to driving our cars.

Today's newer cars, from electric vehicles (EVs) to hybrids to traditional combustion engine cars, have more technology in them than autos of the past. And technology such as lidar (light detection and ranging) for parking assistance or rudimentary systems for driver assistance requires more semiconductor chips to power it.

Due to the global chip shortage, car companies from General Motors (GM) to Ford (F) to Volkswagen (VWAGY) are temporarily shutting down facilities, lacking the chips they need to manufacture more vehicles.

Even amid this slowdown in production, demand for automobiles remains high. And more importantly, the longer-term trend of vehicles becoming even more technology-reliant is here to stay, which means continued and growing demand for chips – great news for semiconductor stocks.

Here are five "auto chip" stocks to watch. Each of these semiconductor companies is exposed to the automotive sector. Thus, they have room to benefit in the months and years ahead as manufacturers work through the supply shortage and their products become ever more integral to the world's vehicle fleet.

Data is as of Oct. 25. Dividend yields are calculated by annualizing the most recent payout and dividing by the share price. Analysts' average long-term growth rate expectations represents the estimated average rate of earnings growth for the next three to five years, and is courtesy of S&P Global Market Intelligence.

• Market value: $24.0 billion
• Dividend: N/A
• Analysts' average long-term (LT) earnings growth rate: 9.8%

When it comes to auto chip stocks, Renesas Electronics (RNECY, $6.16) is one that often flies under the radar, even though 52% of its revenues are strictly from the automotive sector. That's likely in part because RNECY is a Japanese company and its stock trades "over-the-counter" in the U.S.

But in the age of a global auto chip shortage, and amid an explosion in growth for chip-heavy vehicles, Renesas could become a more popular name.

Renesas Electronics is a global player not only in automotive semiconductors, but also in microcontrollers and processors. This combination of digital and analog products creates a one-stop solution for automakers looking for the technology to back their vehicles.

Its chips already power camera and battery systems for companies in the key German and Chinese markets. More applications for the technology are being developed – including creating higher-resolution rear-view cameras at a lower cost – which should expand RNECY's product portfolio in the next few years.

It's also a company that has been able to grow in the past year as many other companies facing supply shortages have started to falter. In its most recently reported quarter, adjusted earnings per share surged nearly 88% from the year prior. That has provided a lift to RNECY shares, which are up almost 40% in the past 12 months.

Those shares remain attractively valued, however, at 20 times forward earnings – considerably lower than the 25 forward P/E of the broader tech sector, according to Yardeni Research data.

• Market value: $6.3 billion
• Dividend: N/A
• Analysts' average LT earnings growth rate: 11.5%

II-VI (IIVI, $59.07) is a play on the rise of laser technologies. Today's lasers are integrated onto semiconductor chips, and where automobiles are involved, are a key part of lidar and other object-detection technology.

The company is currently putting the finishing touches on its roughly $7 billion merger with Coherent (COHR). The final deal is expected to create massive scale, which should help the combined entity better compete in the laser market.

"With COHR's laser capabilities, IIVI is among the most diversified companies in its space, with wide-reaching capabilities across end-markets that are only just beginning to benefit from long-term secular growth cycles," say Stifel analysts, which rate the stock at Buy.

They add that "higher expenses and the pending COHR merger will likely limit upside in shares over the near term" – indeed, shares are off 10% since the merger was announced in late March – but they "remain positive on the long-term outlook."

Translation: While this M&A event is impacting the stock now, it also might be presenting a buying opportunity for patient investors willing to wait out the turbulence.

And the company's role in the growing automotive space could make this a potential gem among chip stocks in the years ahead.

• Market value: $53.1 billion
• Dividend: 1.1%
• Analysts' average LT earnings growth rate: 28.4%

Headquartered in the Netherlands, NXP Semiconductors (NXPI, $200.29) manufactures a number of different products. Among them are application processors, communication processors and wireless and Bluetooth solutions.

As a global giant, it's no surprise that this is one of the key players for the tech trends of the next decade, including the increased technology going into automobiles. In fact, it's already noted as one of the largest auto chip stocks, with a double-digit percentage market share.

On the charts, NXPI has pulled back from its late-August highs. Weighing on the shares was insider selling by some company executives, as well as broad-market headwinds. Nevertheless, this selloff has created an opportunity to pick up a high-quality name at a discount. Adding to the argument for an attractive valuation: shares are currently trading at less than 18 times forward earnings.

The general consensus among analysts is that NXPI is a Buy – and with fairly high conviction, at that. Of the 29 pros following the stock that are tracked by S&P Global Market Intelligence, 13 say it's a Strong Buy, six call it a Buy, nine deem it a Hold and just one rates it at Sell.

For investors with a long-term outlook, this is also an appealing company thanks to the firm's growing dividend. While the yield is low at 1.1%, NXPI's dividend growth – it has more than doubled its payout since 2018 – could pay off for patient investors in the years ahead.

So while supply chain issues may impact some technologies, NXP's diversity will truly be its strength in the months and years ahead.

• Market value: $184.8 billion
• Dividend: 2.3%
• Analysts' average LT earnings growth rate: 11.1%

The company behind your high school graphing calculator has a lot more tricks up its sleeve. It's also one of the largest players in the automotive semiconductor industry. Texas Instruments (TXN, $200.20) plays a big role and looks set to continue being a leader among auto chip stocks.

Thanks to the rise of more technologically complex products from cars to calculators, the company has been on a tear. And a new report on the Machine Vision market that showcases the growth of machines like robots that need vision-guidance – a precursor to self-driving vehicles – highlights Texas Instruments as a notable player.

Another impressive feat? TXN has a fat 40% profit margin, the kind of margin that comes more from a software developer rather than a company that engages in physical manufacturing. These hefty profit margins combined with future growth trends from all tech, including automotive, should lead to years of outsized growth.

As with other big-name semiconductor companies, TXN can reward investors with dividend hikes over time. Shares currently yield 2.3% – a decent starting point for future growth.

And Wall Street pros are generally bullish toward Texas Instruments. According to S&P Global Market Intelligence, 31 analysts cover the stock, with an average rating of Buy.

• Market value: $59.1 billion
• Dividend yield: 0.6%
• Analysts' average LT earnings growth rate: 33.0%

Infineon Technologies (IFNNY, $45.42) is based out of Germany and makes chips for a number of automotive firms, including big European players like Volkswagen. And like other large, global semiconductor firms, the company's role goes far beyond just automotive chips.

Surging cases of the Delta variant of COVID-19 in Asia led many chipmakers – including IFNNY – to suspend some production. Yes, that is bad for the company's operations in the short term, but Infineon is still faring well on a long-term basis. Specifically, in its fiscal third quarter, the company reported a 25% year-over-year jump in revenues.

And while the share price declined alongside the broader market in September, it is up nearly 10% since its early October lows.

In the meantime, the two analysts following the U.S.-listed shares of IFNNY are steadfastly bullish on the chip stock, with both maintaining a Strong Buy rating. Plus, the average price target of $54.50 represents expected upside of 20% over the next 12 months or so.

Shares don't pay a huge dividend, but given the company's leading position in the European automotive market and the region's leadership in rising EV technology, this could be a surprising winner for U.S. investors in the years ahead.

When I was 9, my grandfather gave me a present: my first share of stock. It was a gorgeous, embossed certificate issued by the Ford Motor (F), which had just gone public on January 18, 1956, at $64.50 a share.

In 1988, I decided to sell my share, which after splits had become many shares worth $828. Selling at the time turned out to be a good idea. Ford shares peaked in 1999.

But don’t count Ford out. The drop in revenues from the pandemic was not as bad as expected, and over the past 12 months, the stock has returned 143%; General Motors (GM) has returned 162%.

Ford and GM, two stodgy companies that have been selling pretty much the same product for more than a century, have felt the shock of an earthshaking disruption of their industry. It's a case of respond or die, and the two companies have responded, though a bit late.

Disruptive innovation is a term coined in 1995 by Harvard Business School professor Clayton Christensen. Most people use the shorthand disruption to mean a general shake-up in an industry. But Christensen, who died last year, had a more precise definition: "a process whereby a smaller company with fewer resources is able to successfully challenge established incumbent businesses."

While the incumbents are focused on gradually improving their products to satisfy traditional customers, disrupters target "overlooked segments, gaining a foothold," Christensen wrote.

Incumbents ignore disrupters because those segments are small or unprofitable. The disrupters then expand their offerings, "delivering the performance that incumbents' mainstream customers require, while preserving the advantages that drove their early success." When mainstream customers start adopting the disrupters' products "in volume," you've got real disruption.

Tesla: A Model Disrupter

A model disrupter. An upstart called Tesla Motors, now just Tesla (TSLA), fits the Christensen model. The company was launched in 2003, released its first plug-in electric car five years later, and went public two years after that. Elon Musk took his earnings as cofounder of PayPal Holdings (PYPL) and became an early investor in Tesla; in 2008, he became CEO.

In 2015, when Christensen’s article from which I'm quoting appeared in the Harvard Business Review, Tesla had two models and it sold 50,000 cars. Sales doubled in two years and reached 500,000 in 2020; this year, the forecast is 800,000 vehicles.

Tesla is by far the largest global electric vehicle maker, manufacturing four models, including one with a list price of only $40,120. It's working on a beautiful long-haul truck. Holding Tesla back from even more sales this year is a pandemic-induced shortage of micro­chips, which should be temporary.

The incumbents have responded. Last year, Ford said it would invest $11.5 billion in electric vehicles through 2022, producing a zero-emissions Mustang and F-150 truck. In January, GM announced it would phase out petroleum-fueled vehicles and sell only cars and trucks that produce zero emissions.

I was not a Tesla believer years ago, but I am now. Tesla is still small ($32 billion in revenues last year, compared with GM's $122 billion) and unprofitable. An investment in Bitcoin and sales of regulatory credits to internal-combustion-engine carmakers saved Tesla from showing a loss in the most recent quarter.

Stocks, however, are priced according to expectations, not history, and Tesla's future looks spectacular. In late 2019, Teslas started rolling out of a $2 billion factory in Shanghai, and in April the company announced a $1 billion factory in Austin, Texas.

Musk forecasts that Tesla's U.S. market share will rise from 2% today to 10% in 2025, and analysts at Morgan Stanley project that the company's manufacturing capacity will reach 5.5 million vehicles by 2030. That compares favorably with GM's 6.8 million in 2020.

Tesla's stock price has become more attractive lately, dropping more than 20% from its January peak, partly because of the chip shortage. Its market capitalization (shares outstanding times price) is $647 billion, or nearly twice as much as GM, Ford and Toyota Motor (TM) combined. In fact, Tesla is the seventh-largest U.S. company by market cap, after five tech giants and Berkshire Hathaway (BRK.B); it's bigger than Walmart (WMT) and JPMorgan Chase (JPM).

Is this crazy?

I don't think so. The global auto market is estimated to grow to $9 trillion by 2030.

11 More Automotive Innovators

Tech is the ignition. Tesla is not the only vehicle disrupter. Technology is front and center in the sector. Small, innovative companies abound, most of them still private. But there are good stocks to buy. One of the largest is the dominant ride-hailing company, Uber (UBER), with a market cap of about $90 billion.

Veoneer (VNE) is a Swedish company that makes automobile-mounted cameras, systems that assist night driving and other navigation electronics. Sales were hit last year by the pandemic, and the stock trades at less than half its 2018 high.

Another attractive Swedish firm, Autoliv (ALV), makes auto-safety systems for the global auto industry. Autoliv has been consistently profitable, with a stock that's up by more than half this year. Aptiv (APTV), an Irish maker of sophisticated vehicle electronics, is also highly profitable, with a $38 billion market cap.

Another company with substantial sales and earnings and a commitment to EVs is BYD (BYDDY), based in Shenzhen, China, with a market cap of $60 billion. BYD (an acronym for “Build Your Dreams”) started as a battery maker and now manufactures electric and internal-combustion vehicles; some of its EVs sell for as little as $9,000. Nearly all of Shenzhen’s 20,000 taxis are BYDs. Part of the appeal of BYD: The stock is down 46% since February, despite consistently rising revenues.

China is the largest market for EVs, with 1.2 million sales last year. Two other Chinese manufacturers to note are Li Auto (LI), whose niche is SUVs, and the larger XPeng (XPEV), which makes SUVs and a four-door sport sedan; Xpeng is also in the ride-hailing business. Both stocks are well priced, having fallen by half in less than six months.

More risky but worth consideration are some early-stage auto-tech firms. Luminar Technologies (LAZR) makes sensors and software that enable autonomous driving. Luminar had only $14 million in sales last year, but its prospects have earned it a market cap of $7 billion.

QuantumScape (QS) is a lithium-ion battery maker with no sales in 2020 but a market cap of $12 billion. Beam Global (BEEM), with a market cap of just $276 million, specializes in clean-energy charging equipment for EVs; one of its products uses solar power.

If you prefer a traditional automaker stock, my top choice is Volkswagen (VWAGY), with a dozen brands from seven European countries, including Audi, Bentley and Porsche, plus the truck and bus companies Scania and MAN. VW sold only half as many EVs as Tesla last year, but the demand in Europe is intense, as it will soon be in the U.S.

The coronavirus outbreak has taken its toll on yet another publicly traded company's cash distribution. General Motors (GM, $21.95) announced early April 27 that it was suspending its dividend – the company's second such move in 12 years.

GM stock, which also was forced to suspend its dividend during the Great Recession, put the pause on its 38-cent-per-share quarterly payout as one of several steps meant to fortify the company's balance sheet. General Motors also extended $3.6 billion of its three-year revolving credit agreement to April 2022, which comes roughly a week after it renewed a $1.95 billion 364-day revolving facility for use by its GM Capital arm.

GM also suspended its share repurchase program and has taken "other significant austerity measures.

"We continue to enhance our liquidity to help navigate the uncertainties in the global market created by this pandemic," GM Chief Financial Officer Dhivya Suryadevara said in a statement. "Fortifying our cash position and strengthening our balance sheet will position the company to create value for all our stakeholders through this cycle."

General Motors' announcement comes amid a host of other dividend cuts and suspensions prompted by the COVID-19 outbreak. That includes Ford (F), which halted its dividend in mid-March.

The automotive industry in general is feeling an acute pinch from the coronavirus. During the final week of March, U.S. retail auto sales plunged 59% from J.D. Power's pre-pandemic forecast. The figure has been stabilizing – to 55%, 51% and 48% drops over the next few weeks – but still bodes poorly for automakers.

Meanwhile, General Motors and other automakers' North American plants have been shuttered since late March, with the exception of a few recent reopenings to manufacture ventilators. While they're trying to determine a plan and timetable for reopening for automaking purposes, they'll do so into an uncertain demand climate.

At current prices, GM stock would have yielded 6.9%.

The 25% tariff that the United States imposed on July 16 on $34 billion of imports from China (with $16 billion more to come, likely in August) touches nearly every corner of American consumers’ lives. Why? Because it’s effectively a tax that represents a cost to U.S. producers, wholesalers and retailers. Sooner or later, it gets passed on to consumers in the form of higher sticker prices for everything from an X-ray to a new car. The only real question is how quickly it happens.

Companies that import their products have limited choices: absorb the extra cost of the tariff, increase selling prices immediately, shift production to other countries or do some combination of the three.

Initially, expect a relatively limited impact on consumers because companies will hold the line on prices while they monitor what action competitors take. Plus, the Trump administration excluded some higher-volume goods when it was drawing up lists of Chinese products to target with tariffs. For example, it left off some high-profile consumer goods such as flat-screen TVs, so they shouldn’t go up in price.

Don’t expect the pain of higher prices to be over quickly. There’s another round of tariffs — 10% this time — coming on thousands more imported items from China. They won’t take effect for another two months. But when they do, they’ll affect a huge range of goods that consumers and retailers buy and use on a near-daily basis, from automobile tires, spark plugs and windshield wipers to handbags, batteries and furniture. So brace for successive rounds of price rises on a steadily growing range of imported goods, for much of the rest of the year.

Here are eight product categories that soon may put a bigger dent in your budget:

Anything made with steel and aluminum will cost more because of the 25% tariff on imported steel and the 10% tariff on aluminum.

Relatively few cars are imported from China, but General Motors does import the Buick Envision crossover from there. GM will likely raise the consumer price but isn’t yet saying by how much.

It will cost more to keep your car in top shape. A tariff of 10% is being added to Chinese-made parts, so expect to see auto parts stores impose an increase of about 10% for a new battery or spark plugs. Automobile dealers will pay more, too, so they’ll pass that on to car owners and tack some extra on top of it.

The most significant impact on car prices will occur if President Trump follows through on threats to impose 20%-25% tariffs on European Union-made vehicles because of the EU’s 10% tariff on American-made cars. A U.S. tariff would likely cause prices for imported brands such as Mercedes-Benz to go up by about $5,800, according to industry estimates.

Ford Motor Co. now substitutes greater amounts of aluminum for steel in its best-selling F-150 pickup, aiming for less weight and increased rust resistance, but don’t expect its sticker price to soar. Like all the automakers, Ford likely has aluminum stockpiled and prices negotiated well into the future. The longer a trade war lasts, though, the more inevitable it is that a price increase will show up on dealers’ lots.

Most aluminum used to make beverage cans is imported, and so is much of the tinplate steel in items like soup cans. The Beer Institute warns that the 10% aluminum tariff amounts to a $347-million tax. That likely means beer prices will go up, at least modestly, by something like 20-25 cents on a case of 24 cans. A similar scheme with soup and soda…a few cents per can.

Beermakers have raised much more vocal opposition to the tariffs than food producers — possibly because summer is a peak sales period.

Don’t forget that popular confectionery items like candy bars could also be affected. The Hershey Co. wraps its candy kisses in aluminum foil, for example, so soon enough you may pay another nickel on a candy bar.

For farmers, the tariffs are going to hurt…on multiple levels.

China is a significant producer of farm machinery, from dairy equipment to poultry incubators, which will go up in cost by something close to the 25% tariff. More significant, China’s retaliation for U.S. tariffs included penalizing imports of U.S. food crops, notably soybeans. Since China is the destination for more than half of the U.S. soybean crop, it means they are less competitive in China’s markets, and therefore sales are likely to fall off.

So American farmers are pinched on both ends — the products that they buy from China will go up in price, and their crops will likely be less in demand in Chinese markets. The U.S. Farm Bureau strongly opposed tariffs because of the adverse impact they already are having on commodity futures prices, an extra blow when farmers are facing the prospect of higher interest rates.

In the longer term, expect a modest hit to your grocery bill because farm operators will have to try to recover some of their lost income and rising costs. But it won’t happen immediately, and there may even be temporarily lower prices for a few items. For example, Mexico is imposing a 20% retaliatory tariff on U.S. pork exports, and that is likely to mean that sales to Mexico will suffer. If more pork stays in U.S. markets, prices will fall to move it. It’s a temporary gain, though, because the net result will almost certainly be reduced U.S. production — followed by rising prices on store shelves.

Many types of Chinese-made medical equipment have been targeted by the Trump administration for tariffs, including CT scanners, EKG machines and X-ray tubes. The result: Not only will purchase costs to American buyers go up, but potentially so will medical costs for U.S. consumers.

This is one area where the Trump administration compromised, however, by scaling back its original plans for the range of imports it is penalizing. Still, prices for pacemakers, ultrasound equipment and other gear will rise, and so will prices for associated services, likely by an amount close to the 25% tariff.

Several U.S. companies have factories in China that make orthopedic devices, such as those used in hip replacements. Those products shipped from China to the United States would face tariffs, which would likely end up pushing American recipients’ costs up (though it is hard to gauge by how much).

Last January, the Trump administration targeted South Korean-made washing machines for tariffs of 20% to 50%, and what has happened to their prices may be a guideline for products now being targeted for 25% penalties. Since the start of the year, an imported washing machine costs about 20% more than it did previously. Sellers have passed on a good chunk of the extra cost to consumers, but they’ve also absorbed a portion of it.

It’s a similar story for the solar industry, an early target for trade protection.

Tariff increases for Chinese-made solar panels — 30% in 2017 and lower rates over several more years — now add $500 to $1,000 to costs for a typical home installation project, which generally run around $16,000-$20,000, according to the Solar Energy Industries Association.

Unlike flat-screen TVs, items such as water coolers, minifridges, thermostats and air purifiers are on the tariffs list, and buyers should expect to see their prices go up as soon as this month — by as much as 25% if businesses pass on the full cost.

Need some new sneakers? You’re in luck — for the moment. The shoe industry was exempted from the latest round of tariffs, though that doesn’t necessarily leave industry participants breathing easy. China is the largest producer of footwear imported into the United States, so if the trade war escalates to include another round of tariffs, look out.

A likely reason for the exemption: The majority of the tariffs are aimed at higher-value-added industries in which China is considered to be pushing for dominance. Footwear is more labor-intensive, and in any case, major participants like Nike are increasingly shifting production to lower-cost Asian nations, including Vietnam.

Only time will tell whether a much-ballyhooed global trade war will end up becoming a reality. While President Donald Trump exempted Canada and Mexico from significant tariffs on steel and aluminum imports, he otherwise didn’t back down, at least setting the stage for a commerce-based battle.

Canada’s trade relationship with the United States still isn’t exactly on a firm footing following an accusation from Boeing (BA) that Canadian-based aircraft maker Bombardier dumped underpriced jets in the U.S. market. Meanwhile, the European Union has threatened to impose stiff tariffs on U.S.-made peanut butter and orange juice should the United States press the matter. Russia is less than pleased with trade sanctions levied against it in August of last year.

Perhaps the fiscal brouhaha is already underway ... just in a very veiled fashion.

Whatever the case, with a wave of populism sweeping over most of the world’s top country-based economies (Brexit was ultimately about money, and even China’s President Xi Jinping brings his own unique brand of populism to the communist state), trade wars on some level are at least a real possibility going forward.

That naturally could have a significant effect on several popular publicly traded companies. Here are 10 stocks that could be most vulnerable to a prolonged, trade-based conflict.

Data is as of March 12, 2018. Click on ticker-symbol links in each slide for current share prices and more.

One would think U.S. automakers like Ford (F, $10.81) and General Motors (GM) would be thrilled with higher tariffs on European-made vehicles coming into the United States, as well as higher steel and aluminum tariffs that make it more difficult/costly for Asian carmakers with production plants located in the U.S. Both domestic manufacturers pay a 25% tariff on the cars they deliver to China, making it difficult to compete in that growing market. The EU’s auto import tariff of 10% isn’t much friendlier. Turnabout is fair play.

The fact of the matter is, though, making it more difficult for China and Europe – especially China – to sell its goods in the U.S. could end up ruining an improving relationship between U.S. automakers and China’s import regulators. That current tariff was scheduled to be pared back over time, and moreover, China’s government looked like it was going to become a little more flexible with rules that require foreign (to it) carmakers to partner with China’s domestic automobile companies if they want to sidestep the tariff.

Rekindled trade tensions would prove particularly troubling for Ford, which is already underrepresented in the Chinese market. In November, the company announced plans to ship $10 billion worth of cars and auto parts to China over the course of the next three years, but China’s chiefs may be less keen in the idea if now U.S. automakers can proverbially be held hostage.

Europe could just as easily take direct aim at Ford, if a trade war escalates.

Despite their classic Americana look and feel, motorcycles made by Wisconsin-based Harley-Davidson (HOG, $44.82) are quite popular overseas, too ... particularly in Europe. The EU bought more than 16% of the bikes Harley made last year, making it the biggest foreign market the company addresses. Overseas sales also have been a growing piece of the Harley-Davidson’s revenue mix.

It’s a trend that could come to a screeching halt, however, if the EU follows through on an implied threat to impose tariffs on Harleys, cranberries, bourbon, peanut butter, Levi’s jeans and orange juice should the United States move ahead with its import-tax plan (which it did).

It seems like a strange and almost incongruous list of goods to target. But a closer look at the companies that would be hit the hardest reveals some commonality. The organizations that would suffer the most from Europe’s answer to Trump’s tariff plan are primarily based in the home states of several top GOP leaders, including House Speaker Paul Ryan and Senate Majority Leader Mitch McConnell.

Speaking of targeted tariffs, Paul Varga, CEO of booze giant Brown-Forman (BF.B, $44.82), didn’t pull any punches when offering his view of the potential trade war on the horizon.

“I mean if (the steel tariff plan) comes to fruition, the irony I feel is that a company like Brown-Forman could be an unfortunate and unintended victim of the policy which in part is aimed at promoting ... long-term American manufacturing,” he told a crowd of analysts just a few days ago, adding that it “would obviously be kind of a negative thing for our particular company.”

This couldn’t have come at a worse time for Brown-Forman, which is the name behind Jack Daniel’s, Woodford Reserve and other well-known brands of bourbon. It and several other makers such as Japan’s Suntory (STBFY), which owns Jim Beam and Maker’s Mark, were just starting to turn European consumers on to bourbon. Sales of American whiskey in the EU were projected to grow from 2017’s $2.4 billion to more than $3 billion by 2021.

Bourbon and motorbikes aren’t the only oddly specific goods that could become victims of a trade war. Soybeans, and therefore soybean farmers, are at risk as well.

American Soybean Association President John Heisdorffer opined on the matter: “These tariffs are a disastrous course of action from the White House. They may lead to retaliation by one or more of our valuable trading partners, which in turn will kneecap demand for soybeans in a time when the farm economy is struggling. We have heard directly from the Chinese that U.S. soybeans are prime targets for retaliation.”

It’s a potential problem for a lot of small farmers, but it’s also a risk to the major agricultural outfits like Monsanto (MON, $123.15). In fact, the timing of a soybean battle couldn’t be much worse. Rivals BASF (BASFY) and DowDuPont (DWDP) have unveiled their own soybeans that will compete with those made by Monsanto at a time when Monsanto’s genetically modified versions of soybeans are proving less and less resistant to glyphosate weed killer – you’ve heard them described as “Roundup Ready.”

Electric-vehicle maker Tesla (TSLA, $345.51) is facing a risk similar to the ones GM and Ford are facing, but there’s an even bigger, more immediate risk than soured relations with the governors of the increasingly important Chinese market, where Tesla did more than $2 billion in business last year.

The risk: Tesla may find it more expensive to source materials including much-needed lithium – the core component of EV batteries – if tariffs start to materialize like two boxers just trading blows.

Michael Tanney, co-founder of NYC-based investment advisory Wanderlust Wealth, explains, “The company relies heavily on their ability to purchase and hedge the costs of raw materials for their batteries and cars. With the stock priced to perfection, any negative change in Tesla’s cost to build cars could prove lethal to the already questionable viability of the company.”

There is an irony to the matter, however. Tesla CEO Elon Musk actually supports President Trump’s idea of imposing steeper tariffs on the import of Asian-made cars into the United States. Although that would create a lose-lose scenario for all companies and consumers, Musk argues it would at least level the playing field and in turn force all involved parties to think about a more equitable tariff environment.

iPhone maker Apple (AAPL, $181.72) has thus far proven impervious to geopolitical tensions. Chinese consumers love Apple’s products. American consumers love them, too. And assembly factories in China love being able to make Apple’s devices.

That delicate balance could be upset, however, if China starts to squeeze Apple’s pressure points and/or the U.S. international trade overseers choose to get pull all the levers at their disposal.

Although Trump has spoken broadly about all possible import tariff scenarios, Apple’s business model is a nuanced one that has not been directly addressed. While its devices are assembled in China, they’re designed in the United States, and Apple largely does the sourcing and logistics work for its goods within the U.S. It’s also obviously a U.S.-based company. Ergo, the iPhone and iPad stretch the definition of “import” by most any standard, and therefore the case that it’s not a tariff-subject import is a good one.

If the White House chooses to broadly define an import as any good “made in China” and tax those, however, that could push Apple’s retail prices uncomfortably higher.

Back in 2016, Walmart (WMT, $88.07) warmly embraced the familiar “Made in the USA” mantra, vowing to source more American-made goods whenever it was possible. And, giving credit where it’s due, shoppers have seen more domestically made goods on the retailer’s shelves.

But there are only so many goods, and kinds of goods, that America makes. A huge swath of Walmart’s merchandise still is made overseas. If those goods cost the company more to buy, you can bet Walmart – which sports rather low profit margins already – will feel the pinch when it’s either forced to raise prices, take losses, stop carrying certain items or some combination of all three.

The suggested tariffs also would hit Walmart where it hurts the most, too. Electronics accounts for an estimated 16% of the company’s non-grocery sales, not counting video game sales (which account for another 6% of the retailer’s revenue). Yet, electronics seem to be one of the few areas where a new tariff seems almost inevitable. There just aren’t many U.S.-based electronics manufacturers that can provide alternatives; a whopping 39% of all goods imported into the United States are electronics.

If you want to know when the China/U.S. trade war started in earnest, go back to 2014. That’s when Chinese-made solar panels flooded the market, at what some say were below-cost prices ultimately offset by fiscal support from China’s government – an illegal practice known as “dumping.” The U.S. responded by imposing tariffs that made the effective prices of those panels more or less in line with panels made by U.S. companies.

The solar-panel wars have cooled off since then, somewhat because some of those tariffs are coming to an end, and somewhat because state-sponsored dumping isn't much of an issue anymore. But they may well become a centerpiece of geopolitical tension again in the wake of the current White House's newly-imposed tariffs of as much as 30% on all imported solar panels. These duties appear to have fewer loopholes than the prior duties did.

Higher prices on imported solar panels are good news for American makers. They’re bad news for installers of solar panel systems, however, such as Vivint Solar (VSLR, $3.25). American solar panel manufacturers just aren’t meeting the nation’s need. About 80% of the panels installed in the United States last year were imported, and a steep tariff could mean would-be solar panel system buyers forego an installation altogether.

Vivint Solar CEO David Bywater said of the potential tariffs war, “I’m worried, and not just for our company. Solar power is one of the few things that almost every American says, ‘Please do this. We support this.’ But it’s a fragile ecosystem. If the cost is increased, solar businesses will not be able to do what we do. The margins are thin.”

Wanderlust Wealth’s Michael Tanney also fears Procter & Gamble (PG, $79.86) could find itself on the losing end of any trade war that takes shape from here. He explains:

“Their Gillette business is already being squeezed by the delivery shave companies and must maintain a premium product at a closer price to compete. Without the flexibility to raise prices given the disrupters using less expensive outputs, Gillette will be in a severe bind if tariffs cause a rising price on their raw materials, such as the metal used for blades.”

It’s not just a one-way problem. Though P&G manufactures a fair amount of its goods sold in foreign markets in those markets – circumventing any existing tariffs – a good deal of its overseas revenue is driven by goods made in the United States. If it costs more to make them and also costs more to sell them, the bottom line may just get hit in a way investors aren’t ready to digest.

The kicker: It was only late last year China’s President Xi Jinping was looking to lower taxes on personal goods imported into the country. Those plans may be rethought soon.

Last but not least, athletic apparel company Nike (NKE, $66.82) could suffer from a trade war, but for a less-obvious reason.

Yes, like Apple, Nike relies on low-cost labor from Asia, though Vietnam is its key provider of footwear. Nearly half of its branded footwear is made there. The Trans-Pacific Partnership (TPP) would have ended the 20% tariff on footwear coming to the United States from Vietnam, but with the U.S. bowing out, that tariff not only still applies, but could increase. The company’s goods may simply be outpriced for U.S. consumers.

Worse, should the definition of “import” and “export” be widened to goods made for U.S. companies in another country shipped to yet a different country, Nike could miss out on the 18% sales growth in China it has enjoyed for the past couple of years.

To the extent tariffs don’t slow its overseas business down, boycotts could. Although Chinese consumers love Western products, they’re also loyalists and have stood up against U.S. companies (with some state-prompted encouragement) in the past. Nike would make for a relatively easy boycott target, as alternative athletic wear is abundant.

James Brumley was long F as of this writing.

When you’re shopping for a new car, dickering with the dealer to lower the sticker price may be your main concern. But even if you drive the car until the wheels fall off, overlooking resale value could be a costly mistake. “Depreciation is the largest cost in owning a car, more so than fuel and repairs,” says Tim Fleming, an analyst for Kelley Blue Book (KBB). Even if you don’t plan to sell it anytime soon—or ever—how your vehicle retains its value is important. For example, if your car is totaled in an accident, insurers will cut you a check for the value of the car at the time of the incident.

Midsize pickup trucks and midsize and large SUVs hold their value best, according to KBB. That’s because cheaper gas and improved fuel economy have boosted their appeal. Electric vehicles and subcompact and luxury cars depreciate the most over time. (Porsches are an exception because low volume fuels demand from status-conscious buyers.) Sleek “performance” vehicles, such as the Volkswagen Golf R and Subaru WRX, fare best after the bulky SUVs and trucks.

The five brands that hold their value best over five years are:

• Toyota (36.2%)
• Chevrolet (36.0%)
• Subaru (33.9%)
• Ford (32.1%)
• Porsche (31.6)

But resale values can vary widely among models within the same brand. For example, the Toyota Tacoma truck was named KBB’s resale winner for 2017, holding 67.5% of its value after three years and 57.5% of its value after five years. The 4Runner SUV came next, with a resale value of 62.2% after three years and 52.5% after five. But the tiny Prius C and Yaris models held only about 30% of their value after three years and 20% after five.

KBB and Edmunds.com both offer “cost to own” tools, which allow you to enter a make and model and calculate additional costs of vehicle ownership—including depreciation—over the course of five years. The higher the depreciation figure, the more value it loses over time.

One way to make depreciation work to your advantage is to buy a used car instead of a new one. Thanks to a glut of off-lease vehicles, prices for used cars have declined. Fleming says he expects the bargains in used cars to last another two years.

See Also: How to Get a Great Deal on a New Car

Cars in general have become more reliable over the years. Yet there are some models that just seem to keep rolling along, whistling past the junkyard. Pinpointing exactly how many miles, on average, any given model has racked up is virtually impossible, but we’ve identified 15 cars with exceptional—sometimes surprising—endurance and value.

We bet you’ve seen one of these still cruising the highway recently. Oh, and if you’re wondering where your beloved Ford F-150 or other truck is, note that we skipped traditional trucks altogether. Trucks are supposed to last forever. Please have a look at our choices:

(Editor’s note: The author has owned a couple of these cars, and he teased a full 15 years out of a VW Passat, a model that, unlike the cars featured here, has a bit of a death wish.)

• Model years: 1976-Present

Here’s a wager: Next time you’re out for a spin, watch for a nondescript, tan or silver four-door. Good chance it’s a Honda Accord.

Combine reliability and best-selling status—a true virtuous cycle—and you get ubiquity. Exactly what it is about Honda that provides such durability is the subject of much debate (and much corporate envy/espionage involving Honda’s design and manufacturing processes). But surely some of it has to do with the fact that Honda Motor Company puts its engines and engineering first. Look up Honda Accord in Consumer Reports’ ratings and you will see a sea of red dots that indicate owners have darn few problems with these cars.

The smaller Honda Civic shares much of the quality but is more likely to be modified by its owners to look flashier and run louder, with maintenance simultaneously neglected. So the Accord gets our nod.

• Model years: 1991–1996

Behold the last of the big American station wagons. This General Motors behemoth offers an appealing combination of reliable, modern(ish) technology and retro looks.

In the later years of its production, the Roadmaster was armed with a honking 5.7-liter V8 closely related to the Chevy Corvette’s to move all that mass. Rear-facing third-row seats, wood paneling on the sides, shifter on the steering column—all the elements of the Great American Wagon are there. You can even squeeze a third passenger up front if the ruckus in back gets too loud. “Cheap to insure,” says Kevin Cullinane of Bethesda, Md., who has owned two of these big boys as well as a lot of other older American iron, and “parts are cheap and plentiful.” With a gentle foot on the gas, Cullinane gets 17 miles per gallon in town, and 23 to 24 mpg on the highway. “Quite a feat for a car this weight and size,” he says.

The wagons seem to have outlasted their mechanically identical sedan brethren, such as the bulbous Chevy Caprice that was a fixture of police and taxi fleets in the 1990s. Lower-stress suburban living may be the reason. Closely related but scarcer: the Chevy Impala Wagon and Oldsmobile Custom Cruiser.

• Model years: 1984-2010

The Geo Prizm is one of a number of vehicles that have at their core one of the most reliable cars ever: the Toyota Corolla. But while the Corolla’s longevity goes unremarked, the Prizm and its stable-mates cause head-scratching as they soldier on into their second or even third decade: What is that thing? How is it still running?

This Corolla clone (marketed as a Chevrolet at one point) also appeared as the Chevy Nova (1984-1988) and the Pontiac Vibe (2002-2010). All of these cars were the product of a Toyota-GM joint venture called NUMMI, a Fremont, Calif. factory that built nearly 8 million vehicles of Toyota’s basic design before it closed down in 2010. These were the first Toyotas assembled in the U.S., and the story of how this location’s jaded United Auto Workers workforce learned the “Toyota Way” and turned out cars just as good as the ones built in Japan is a fascinating one (you can listen to it in an episode of the public radio show “This American Life”).

These cars get highway mileage in the 35 mpg range, which has made them Old Gold when gas prices are high. A shrewd shopper looking for a used Corolla might consider one of these instead. The seller might not realize what he’s letting go.

• Model years: 1950-1992

The VW van, which creates instant counterculture nostalgia for baby boomers, keeps finding new generations of fans. Just look at the comic strip Zits, whose 16-year-old protagonist drives one.

A combination of sheer devotion from its fans and a deep reserve of used parts (thanks in part to its sharing many components with VW Beetles) keeps the VW Vangoing and going. Many are sun-faded and seem to rely on bumper stickers and duct tape to hold them together, but some VW Vans actually attract serious collector money: The 23-window models of the 1950s can fetch six figures. And the handful of later-model Vans that were equipped with all-wheel-drive (Syncro) have a committed following in the mountain west’s ski towns.

But teenagers (or their parents) looking to grab one of these on the cheap can still do so with a little hunting. “A lot of people kept them around, even when they moved on to something else,” says Everett Barnes, creator of the Web site The Samba, a key resource for owners of older VWs. Very often, a backyard find just needs a fresh battery to start up, Barnes says, and getting it roadworthy may cost a relatively modest $500 to $2,000.

• Model years: Dawn of Man-1996

Volvo’s secret? It basically built one car for decades under a variety of model names. In its staid Swedish way, the carmaker eschewed fashion and focused instead on quality (and safety). About the only thing that will kill off a Volvo is rust, says Mark Bredesen, the owner of Herndon, Va., import-repair-shop Autoscandia, who’s been working on Volvos since 1978—and the later models largely conquered that problem with galvanized steel. After a first round as the family truckster, these cars often devolve to being the kids’ college vehicles—and sleeping quarters at jam-band shows.

Volvo has earned much press for longevity thanks to Irv Gordon, of Patchogue, N.Y., whose 1966 P1800 (a sporty model seen on the introductory page of this slide show) has more than three million miles, putting it in the Guinness Book of World Records as the car with the most mileage.

• Model years: 1979-1993

Let’s just get this out of the way: The Saab 900 may be the Volvo 240’s Swedish cousin, but it doesn’t share its inherent reliability or simplicity of design. Weak transmissions are among the problems with the 900, says import expert Bredesen.

That said, this “other” Scandinavian has its own cult-like following that keeps a good number on the road, particularly in New England and Colorado, where the front-wheel-drive Saabs were popular for their great handling in snow, back before all-wheel-drive became a common feature.

"We do see a lot of them through the shop," says Chris Campbell, a technician at Swedish Solution, in Westbrook, Maine. "Their owners are pretty fanatical about their cars. We have one who drives her 1983 900 Turbo across the country twice each year, and the last time we did service on her car, a routine brake job, her car had over 435,000 miles and was still running like a top." The Wisconsin Automotive Museum near Milwaukee features a 1989 Saab 900 SPG that was driven more than a million miles before being donated.

The irony, of course, is that some of these cars have outlived Saab itself. These 900s were the last models designed by the car manufacturer before it was bought by GM, which in turn unloaded the brand in 2010 as part of its bankruptcy recovery. Saab as we knew it died shortly thereafter.

• Model years: 1990-Present

The toughness of Subarus (with their standard all-wheel-drive) sometimes gets conflated with reliability, but they’re not the same thing: Just ask the many owners who had cylinder-head-gasket failures.

Nonetheless, many keep on trucking, particularly for owners involved in higher education. Have a look in the parking lots of colleges and universities in the Northeast and Pacific Northwest, where they serve as the transportation of both professors and students. The only way to tell whose is whose is by the bumper and window stickers.

While Consumer Reports lists the 2005 Impreza wagon as a best buy for under $10,000, it also notes some model years of the Outback and Legacy as cars to avoid. Caveat emptor.

• Model years: 1975 and beyond

If you wanted a Mercedes in the 1980s that got reasonable mileage—that is, above 20 mpg—you got a diesel. That the company sold as many as it did was largely a fluke of federal regulations; the thrifty diesels allowed Mercedes to meet fleet fuel economy standards. They also were built to run forever, with not a single bit of electronics needed under the hood.

“[These cars] are like a rocking chair made out of hickory,” says Mitch Carr, who’s been working on these models in his Kensington, Md., shop since 1986. “Once you get it started, you could throw out the battery and it would keep running. There’s nothing to go wrong.”

Generally garaged and carefully serviced by their original buyers, many of these are now with their second or third owner. They’re popular among tinkerers, especially those who like to convert them to run on recycled vegetable oil.

Mercedes was one of the few manufacturers that continued selling diesels after this “golden era” of the diesel, though sales were minimal when gas was cheap. The core reliability of a diesel engine remains the same in these later models, but the later Benzes suffered the same software teething problems of their gasoline-powered counterparts in the late 1990s and 2000s.

• Model years: 1992-forward

The 1992 model year marked the point where the Camry really hit its stride and went on to become a sales and endurance leader.

Two reasons: The styling, which evoked Toyota’s then-new Lexus luxury line, and roominess. Camrys that Toyota had imported to the states up until then had hewed to a Japanese market restriction of being no more than 67 inches wide. For 1992, Toyota decided to build a separate model just for the North American and Australian markets that was 70 inches wide. In so doing, it created a competitor to the 71-inch-wide Ford Taurus, which it would go on to dethrone as the most popular sedan in the U.S. in 1997. It’s held that honor for all but one year since.

Many, if not most, of those millions sold are still around. “You see them going 200,000, 300,000 miles all the time,” says Tom Torbjornsen, author of How to Make Your Car Last Forever. “They’re just very well made.” Note that some of the recent black eyes the Camry (and Toyota generally) received over sticking gas pedal issues have nothing to do with the car’s long-term durability.

A group of Lexus models share the Camry’s roots and durability (but with plusher accomodations): the Lexus ES 300/330/350 and RX 300/330/350. Same story for the Toyota Avalon, essentially a stretched Camry.

• Model years: 1991-2002

Transportation, nothing more. Reasonable reliability. Way cheaper on the used market than a Toyota of the same era.

Virtually nobody gets excited about a Ford Escort, but for people who need a way to get to work for not a lot of dough, this is a prime mover. That’s why it made a crowdsourced list of the 10 Best Cars for Poor People on the car blog Jalopnik, which commented, “Everyone seemed to agree that Ford has turned out some very straightforward a-to-b automobiles that depreciation has made into solid bargain buys.”

The years we’re discussing mark Ford’s second bid at selling a model named Escort in the U.S. It’s not to be mistaken for the first, sold from 1981 to 1990, which is best forgotten. The 1991 Escort represented one of Ford’s more successful collaborations with Mazda, and it owes much of its design to the Mazda Protégé. The shared DNA can also be found in the Mercury Tracer and Ford ZX2.

• Model years: 1982-2002

These cars' refusal to die is not necessarily a function of inherent reliability. It’s the sheer bullheadness of their owners, aging children of the ‘60s and ‘70s, who still want to drive a two-door American sport coupe with a V-8 and rear-wheel-drive and no way is it going be a Mustang (because that would be a Ford.)

They can’t afford a new Camaro (or other new, hot sport-coupe offerings, such as the Dodge Challenger). And they can’t afford pony cars from the actual muscle-car era of the late 1960s and early 1970s, which are now only for well-heeled collectors. So that leaves the F-Body cars, in conditions ranging from impeccably polished to primer gray.

They’re an aspirational ride of sorts, says Bob Merlis, creator of the blog Feral Cars, which tracks old and interesting (but not show-quality) vehicles. “People always preserve them. They’re the ‘I’m going to get around to [fixing] it’ kind of car. They don’t get crushed.”

Another factor in their favor: Used parts are abundant, given how many of these were put into a ditch early in their lives due to youthful indiscretions.

• Model years: 1992-2011

These road tanks have been doing a great job taking Granny and Grandpa to church every Sunday for decades. Even though the civilian versions lack the endurance-building parts installed in police cruisers and taxi fleets, such as oil coolers and stronger suspensions, the core components of the American sedan are all there: V-8 engine, solid rear axle, body-on-frame construction.

The Chevy Caprice held this niche as well until the mid-1990s, when GM decided to turn its production facility over to big SUVs.

A footnote: The Marquis went to the guillotine along with the entire Mercury brand with the 2011 model year, and most Crown Vicotoria sales from 2008 on were to fleets. But the vehicles are plentiful in the used-car marketplace, and as one fan put it on Jalopnik, “replacement parts number in the billions and are bought for beans.” If you’re dead-set on buying a former police car, there are even outfits that recondition them for sale to civilians.

• Model years: 1989-2005

Despite the best efforts of GM marketing departments to persuade car buyers otherwise, most people realized by the 1990s and 2000s that Buicks, Chevrolets, Pontiacs and Oldsmobiles were all very similar under the skin.

And yet, it’s the Buicks that got the love in this era, as reflected in the many, many awards the brand won from quality-rankers J.D. Power and Associates. The LeSabre won “most trouble-free domestic” in 1990, and the brand as a whole was the top among domestics for initial quality. Fifteen years later, the LeSabre won “most dependable full-size car.” There were more honors in between those years, and Buick continues to do well in these surveys.

A reason these cars endure? Experts point to who was buying them: seniors. “It’s a great little-old-man car,” says Feral Cars’ Merlis. “They’re not pushing them hard, and they’re maintaining them well.” This makes the LeSabre a prime car to pick up used, says Ivan Drury, an automotive analyst for Edmunds. “If you need something cheap for [getting from] point A to point B, you can’t go wrong with these.”

Other Buicks (Centurys, Regals and Park Avenues) also do quite well. As with many GM cars from that era that have V6 engines, watch out for leaky or degraded intake manifold gaskets, a potentially pricey fix.

• Model years: 1987-2001*

We’re going to make an exception to our “no-trucks” rule for the Jeep Cherokee. For one thing, it’s not really a truck. As the first small crossover in the U.S., it did not have traditional body-on-frame construction of a traditional SUV.

Despite that, and despite being the last gasp of the dying American Motors Corporation, it did have Jeep toughness in its DNA, excellent off-road abilities and a well-proven, durable, straight-6 engine. Many Cherokees are still roaming America’s secondary roads—and Europe as well, in a turbodiesel variant. There’s a caveat, says Edmunds’ Drury. “It will drive,” he says, “but is everything working? Probably not. A window might not go down, or a speaker might be out.”

For owners willing to put up with those sorts of niggling problems (or fix them themselves), the Jeep Cherokee can be an interesting combination of a vehicle that will go just about anywhere—and keep doing so for a long time.

*The Cherokee, known in-house as the XJ, was produced beginning in 1984, but we’re starting with 1987, the first year the straight-6 engine was offered.

• Model years: 1995-1997

Jaguar? Really? This pick caused a lot of brow-furrowing among experts we spoke to. “If you want to make friends, you don’t want to recommend that,” cautioned Bob Merlis of Feral Cars.

Here’s our thinking: During the 1970s, Jaguar reliability was horrid. A common solution to the car’s troubles was to rip out the Jaguar motor and replace it with a good old Chevrolet V8. But in the 1980s, under the leadership of an industrial turnaround specialist, Sir John Egan, the marque started to improve. Then Ford bought the company, infusing money and development know-how. By the late 1990s, the company was scoring well on J.D. Power vehicle dependability and initial quality rankings. So that’s why the last iteration of the classic Jaguar inline-6 sedan is still motoring on, often in the hands of a second owner who’s always hankered for a Jag but couldn’t afford one new.

“With these cars almost 20 years old now, it’s death by a thousand cuts rather than catastrophic failure,” says Mark Stephenson, a site administrator for Jag-Lovers.com. “But mechanically, the 1995-97 Jaguar XJ6s are the most reliable cars Jaguar has ever produced. When it comes to the basic function of getting you down the road, they refuse to die.”

For aspiring owners, the usual cautions still apply: Find a Jaguar specialist, and check out Jag-Lovers buyer’s resource to be a better problem spotter.

When it comes to the cost of your car insurance, there are things you can control fairly easily, such as what you drive and how you drive it. And things you can't, such as where you live. In fact, differences in state laws, court rulings and driver behavior mean the insurance bill in one state could be more than double the bill on the same vehicle in another state.

Based on Insure.com data.

This is the fifth year of the study, which gathers quotes from six major insurers in multiple zip codes in all 50 states and Washington, D.C., averaging rates for the 20 best-selling vehicles nationwide. Those models, led by the Ford F-series pickup, represented 40% of the new-car market in the U.S. in 2014.

Rates are based on full coverage for a single, 40-year-old man who commutes 12 miles to work each day. The hypothetical driver has a clean record and good credit. The policy has limits of 100/300/50 ($100,000 for injury liability for one person, $300,000 for all injuries and $50,000 for property damage in an accident) and a $500 deductible on collision and comprehensive coverage. The rate includes uninsured motorist coverage.

For the second year in a row, Michigan tops the list of the most expensive states, with rates nearly 89% above the national average. It's basically in a class of its own, with an average that’s 31% more expensive than that of the second-costliest state, Montana.

Penny Gusner, consumer analyst for Insure.com, says the main culprit is the Great Lakes State’s no-fault personal injury system, which provides unlimited lifetime medical benefits to injured motorists. "If someone is seriously injured, these auto insurance benefits could be paying out for decades," she said. Those generous benefits also attract fraudsters who file false injury claims, raising costs even more. And Michigan has a lot of uninsured drivers: 21% (versus a national average of 12.6%), according to the Insurance Research Council. Those free riders raise costs for everyone else.

Second-place Montana has insurance rates that are 44% above the national average. According to statistics from the Insurance Institute for Highway Safety, the Treasure State has the highest rate of fatal accidents in the country. "Auto accidents so severe that they result in fatalities are expensive to car insurance companies, and thus lead to higher premiums for motorists," says Gusner.

At the other end of the cost spectrum is Maine, where the average insurance premium is 39% less than the national average (and a whopping 57% less than in Montana). Although they are both relatively rural states, Maine’s fatality rate is roughly half that of Montana. And only 4.7% of Maine’s drivers are on the road without insurance, according to Insurance Research Council statistics.

Zip codes matter a lot, too. In some cases, the difference between two zip codes in the same state is bigger than between two states with sharply different average rates. Take New York, for example. It's actually a fairly low-cost state, 42nd in the nation with an average annual cost of $1,013. But in Brooklyn (zip code 11226), the average car insurance premium is $3,877, almost four times the state average, according to Insure.com,. If you want to dig into that kind of detail, check out CarInsurance.com ’s Average Car Insurance Rates calculator.

First, the bad news: the prices of crude oil -- and gasoline at the pump -- are through the roof again. Pundits talk grimly about the nation's overdependence on oil from nations in turmoil in the Middle East and north Africa -- and the potential for even more price spikes ahead.

But here's a bright spot: Americans are using less oil -- a trend that’s sure to continue. U.S. oil consumption peaked in 2005, at about 21 million barrels per day, and the trend is expected to continue for the rest of the decade. What's going on? Here are eight reasons America will keep reducing its thirst for oil.

By Jim Patterson, Associate Editor, The Kiplinger Letter

March 2011

By the 2016 model year, automakers will have to achieve average fuel economy for their passenger cars and light trucks of 34.1 miles per gallon, up from 27.3 mpg in the 2011 model year. The rule change means auto companies will have to improve their models’ fuel efficiency by 4.3% each year between now and 2016.

Washington isn’t stopping there -- regulators are working on even stricter rules for model years 2017 through 2025, with final targets expected to range from 47 to 62 mpg for cars and light trucks. These conservation moves spell a huge reduction in oil use.

Battery power promises to take fuel efficiency to the max, as automakers expand their offerings of conventional hybrid cars and roll out models that can run purely on electricity. The 50-mpg Toyota Prius, the most recognizable hybrid on the road, faces increasing competition from Honda, Ford, Hyundai and other manufacturers making their own hybrids.

Meanwhile, Nissan’s all-electric Leaf and Chevy’s plug-in hybrid Volt run on electrons and never or seldom need gas. Look for more manufacturers to join the electric-car rollout in the next few years, particularly as battery costs decline.

In response to rising consumer demand, automakers are designing downsized engines that keep horsepower up while cutting fuel consumption. How? They're using turbochargers, direct fuel injection and advanced transmissions with more gears. Result: Ford, Hyundai, Chevrolet and Honda have all recently introduced conventional gas-powered cars that achieve at least 40 mpg on EPA’s highway test cycle. These cars include models of Ford’s Fiesta and Focus, Chevrolet’s Cruze, Honda’s Civic and the Hyundai Elantra.

Until a year ago, the only gas-powered, nonhybrid car in the U.S. that could manage that trick was Daimler’s smart fortwo, a tiny two-seater. Meanwhile, lots of older gas guzzlers were retired as part of Uncle Sam’s recent cash-for-clunkers program.

The number of miles driven by U.S. drivers grew every year from 1991 until 2005. But the trend reversed in 2006, as the number of miles driven dropped slightly from 2005’s 1.7 trillion.

The trend continued into 2007 and accelerated dramatically in 2008 -- down to just over 1.6 million -- when expensive oil pushed gas prices over $4 per gallon. The consensus among analysts is that the trend will continue. As the age-old axiom puts it: The cure for high prices is...high prices.

The rapid spread and widespread use of global positioning systems for finding the fastest, least-congested routes to work and other destinations is making travel more efficient. Truckers are leading the way. The price of diesel fuel is their biggest cost, and with diesel fuel now more costly than gasoline, trucking firms are doing all they can to wring more miles out of each gallon. GPS is playing a big role, helping drivers drive smarter and conserve fuel.

Meanwhile, railroads -- also a user of diesel fuel -- are switching to lighter rail cars, more-efficient locomotives and friction-reducing rails to cut their consumption.

More than half of all states now employ some form of electronic toll collection, which allows drivers to pay road tolls without having to stop and fumble for change to hand an attendant while wasting fuel and, in turn, causing fuel-wasting backups.

E-ZPass and other such electronic systems will grow more prevalent as cash-strapped states look for ways to cut toll collecting expenses, including salaries for toll collectors. It’s a small change that can save millions of gallons of fuel each year.

Abundant supplies of natural gas in the U.S. spell a viable and growing alternative to oil. Today, there are about 110,000 vehicles running on natural gas in the U.S. Most are in light-duty commercial roles -- city buses, for example.

But vehicle use of natural gas is poised to soar in coming years as new fields are tapped, driving the price of natural gas to rock bottom. It’s cheap, too -- engines burning compressed natural gas cost less to operate than oil-powered models. Truckers are eying a switch to liquefied natural gas that produces the same power as big diesel engines at about $1.50 less per gallon.

Ethanol distilled from corn has already displaced about 10% of U.S. oil demand. That’s sure to go up, courtesy of the Environmental Protection Agency’s thumbs-up to a 50% increase in the amount of ethanol that refiners can blend into regular gasoline. Also helping the cause: Growing acceptance and use of E85 -- 85% ethanol and 15% gas -- in vehicles equipped with "flex fuel" engines.

Though cars running on E85 get fewer miles per fill-up, the cost of a gallon of E85 is now about 50¢ cheaper than a gallon of gasoline. That’s getting people’s attention. Biofuels will make even greater inroads as production expands from grains to nonfood materials such as algae, switchgrass and, yes, even household trash that’s now thrown into landfills.

SLIDE SHOW: America's Changing Energy Picture

FORECAST: Where Energy Prices Are Headed

SLIDE SHOW: 2011 Cars -- The Most Fuel Efficient

SLIDE SHOW: 8 Robots That Will Change Your Life

SLIDE SHOW: 10 Energy-Efficient Moves to Do in a Weekend