According to Jim Farley, CEO of Ford Motor Company, Trump-era tariffs on Chinese goods will remain in place for at least the next three years. Despite the expected multi-billion-dollar impact, Ford is staying the course — maintaining vehicle prices and continuing to bet on U.S. production.
🔹 Ford’s U.S. production is a buffer against tariffs
Analysts say Ford is well-positioned — 80% of its U.S. vehicle sales come from domestic manufacturing, reducing its exposure to import duties and giving it a competitive edge. In contrast, GM manufactures only 53% of its U.S.-sold cars domestically.
Still, Ford isn’t immune. The company expects tariffs to raise annual costs by $2.5 billion, especially due to imports from Mexico and China. However, Ford has already managed to cut around $1 billion in costs through strategic logistics, such as routing cars via Canada to avoid certain tariffs.
🔹 U.S.–China tensions: Cold war continues
Tensions between Washington and Beijing remain unresolved. Trump has no plans to meet with Xi Jlnping, but has hinted at possibly reducing the 145% tariff on Chinese goods. Meanwhile, China has compiled a list of American products exempt from its 125% tariffs, aiming to de-escalate the trade dispute without appearing weak.
Farley believes one thing is certain — the tariffs are not going away anytime soon. And Ford is planning accordingly.
🔹 Ford halts car exports to China but stays active
Ford has suspended exports to China, though it still imports models like the Lincoln Nautilus from there. While tariffs are adding pressure, the company beat earnings expectations last quarter, posting $40.7 billion in revenue, down 5% year-over-year but above the expected $36 billion.
Some projections claim that Trump’s 25% tariffs on car imports could cost U.S. automakers over $100 billion this year. Despite that, consumer panic buying has pushed up profits, with Ford offering aggressive discounts to increase its market share.
🔹 Ford’s EV division could lose up to $5.5 billion
While gas-powered vehicles are still generating big numbers (Q3 revenue hit $21 billion), Ford’s electric and software divisions are under heavy strain. The company expects up to $5.5 billion in EV-related losses this year.
This prompted Ford to halt its expensive FNV4 EV platform project, which had become unsustainable due to rising costs and delays. Farley described this move as a “significant capital efficiency gain.” Meanwhile, Ford Pro (commercial vehicle division) reported $15.2 billion in Q1 revenue, down 16% from last year.
📌 Summary:
Ford is bracing for prolonged tariff pressure, but thanks to its domestic manufacturing, adaptive strategy, and price discipline, it’s staying relatively resilient. However, challenges remain — soaring import costs, slowing EV momentum, and geopolitical uncertainty. Still, Ford is holding its line while others panic.
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