The three biggest U.S. automakers have warned that commodity inflation tied to the Iran war will cost them about $5 billion this year, as the conflict squeezes supplies of aluminum, plastics, and other inputs and raises the prospect of higher vehicle prices later in 2026.
General Motors, Ford, and Stellantis each flagged rising input costs in first-quarter earnings last week, citing logistics, energy, aluminum, and DRAM memory chips.
GM raised its 2026 commodity inflation forecast to between $1.5 billion and $2 billion, up from an earlier $1 billion to $1.5 billion.
"The war in Iran has raised our costs and its duration remains uncertain," GM Chief Executive Mary Barra told investors, adding that the company would offset the pressure by trimming spending elsewhere.
Ford projected commodity headwinds of just over $2 billion this year, roughly $1 billion higher than its previous forecast, excluding costs tied to last year's fires at its primary aluminum supplier, Novelis.
Chief Financial Officer Sherry House attributed the increase to global aluminum and steel shortages worsened by the Middle East conflict.
Stellantis, the parent of Chrysler, Jeep, and Peugeot, said it was largely hedged in the first quarter but estimated raw material costs could add about 1 billion euros (about $1.18 billion) in 2026 if current prices hold.
Aluminum is the central pressure point.
Iranian missile and drone strikes on March 28 hit the Emirates Global Aluminium smelter in Abu Dhabi and Aluminium Bahrain, taking roughly 3 million metric tons of annual capacity offline, industry analysts said.
London Metal Exchange three-month aluminum futures reached a four-year high near $3,492 a ton on March 30, while U.S. buyers paid record Midwest premiums on top of a 50% Section 232 tariff in force since June 2025.
The Financial Times reported that the LME price has risen as much as 16% since the war began.
The hostilities began Feb. 28 with U.S. and Israeli airstrikes on Iran.
Tehran responded by effectively closing the Strait of Hormuz, the chokepoint for about 20% of global oil and gas, where shipping has dropped more than 90%, according to the U.K. Royal Navy.
A two-week U.S.-Iran ceasefire announced on April 7 has been extended without resolving the dispute, and the U.S. Navy has blockaded Iranian ports since April 13.
The commodity bill roughly matches the $6 billion the Big Three expect from U.S. tariffs, the FT reported.
The Supreme Court on Feb. 20 struck down President Donald Trump's "liberation day" tariffs in a 6-3 ruling, opening the door to refunds, though Section 232 duties on steel and aluminum remain in force.
On Friday, Trump said he would raise tariffs on EU-built cars and trucks to 25% next week, accusing the bloc of failing to comply with last year's trade deal.
Most automakers have been cushioned so far by fixed-price supplier contracts and existing hedges. Analysts say those buffers will erode if the conflict drags on, raising the likelihood of consumer price increases.
Jim Thomas ✉
Jim Thomas is a writer based in Indiana. He holds a bachelor's degree in Political Science, a law degree from U.I.C. Law School, and has practiced law for more than 20 years.
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