Ford Faces $2 Billion Tariff Hit Amid Trump's Trade Policies
American automaker Ford is bracing for a significant impact from President Donald Trump's tariffs, with estimated costs reaching $2 billion this year, exceeding previous expectations.
Despite manufacturing most of its cars in the US, Ford's finances will take a hit, particularly due to levies on Mexico and Canada, where it has facilities, as well as US tariffs on imported aluminum and steel.
In the three months ending in June, Ford paid an additional $800 million in duties. The company's finance chief, Sherry House, attributed the increased forecast to prolonged higher tariffs on Mexico and Canada. Ford's CEO, Jim Farley, emphasized that the company is in regular contact with the White House, seeking lower tariffs, especially on vehicle parts.
Ford's experience mirrors that of its competitors. General Motors reported tariff costs exceeding $1 billion, while Volkswagen estimated its losses at $1.5 billion. Trump's tariffs aim to reshape global supply chains and encourage companies to manufacture products in the US.
The tariffs will likely reduce Ford's earnings by about $2 billion, resulting in adjusted earnings before interest and taxes of $6.5 billion to $7.5 billion this year. This represents a significant drop from last year's earnings of $10.2 billion. Despite this, Ford's shares fell 1.5% in extended trading after the earnings announcement.
Source:BBC News
