Ford Suspends 2025 Outlook Amid Trump Tariff Strain
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Ford Motor Co. suspended its full-year financial guidance and said President Donald Trump’s auto tariffs will take a toll on profit, joining rivals stung by volatile global trade policies.
The automaker expects the duties to reduce 2025 adjusted earnings before interest and taxes by about $1.5 billion on a net basis this year, it said while that beat expectations. The company’s total tariff impact is about $2.5 billion, $1 billion of which the company expects to offset through actions such as using so-called bonded transportation to shield parts from levies as they cross international borders, Chief Financial Officer Sherry House told reporters.
Ford cited seven factors in withdrawing its earlier forecast for as much as $8.5 billion in adjusted Ebit this year, including potential “industrywide supply chain disruption” tied to Trump’s duties and the risk that levies may increase in the future.
The company plans to provide an updated outlook when it reports second-quarter earnings.
Ford is the latest automaker to point to the steep costs of Trump’s back-and-forth campaign to reshape global trade routes. Trump has said 25% tariffs imposed on imported vehicles and parts are needed to bring more production and jobs to the U.S. Automakers have warned that broad, lasting tariffs will increase costs, jeopardize employment and potentially increase new-car prices that are already nearing $50,000 on average.
Ford CEO Jim Farley last week said the company won’t increase the price of its vehicles until it sees how rivals respond to added tariff costs.
The $1.5 billion hit Ford now expects comes despite relief granted to automakers last week. Trump spared imports subject to the auto tariffs from paying additional levies targeting other goods, such as steel and aluminum. The White House also will phase in tariffs on auto parts over two years to give companies time to move production to the U.S.
Ford’s tariff exposure is less than its Detroit competitors because the Dearborn, Mich.-based automaker domestically produces 80% of the cars it sells in the U.S. General Motors Co. last week slashed its profit outlook for the year and said its tariff exposure was as much as $5 billion. GM on May 2 cut jobs and production at a Canadian plant producing Chevrolet Silverado pickups as it moves production of those models to a plant in Indiana.
Ford has struggled with higher warranty costs and other expenses, including losses on electric vehicles it has said may reach $5.5 billion this year. The cost of launching redesigned versions of its big Expedition and Lincoln Navigator sport-utility vehicles in the first quarter also sapped profits.
Ford’s first-quarter adjusted profit was 14 cents a share, better than the 4-cent average loss expected by analysts.
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