Throughout now-President Donald Trump’s campaign, one of the many policies he batted around revolved around the idea of imposing universal tariffs on products imported into the U.S. from countries such as Canada and Mexico, which could pose a problem for companies like Ford, as it builds several models in Mexico currently. Recent reports suggested that Trump planned to implement these tariffs on his first day of presidency, though that didn’t happen. However, Trump hasn’t backed down from the idea of doing so in the coming days.
According to the Associated Press, Trump told reporters that he plans to implement a 25 percent tariff on goods imported from Canada and Mexico on February 1st, adding that he’s still mulling plans for additional tariffs on Chinese goods after speaking with President Xi Jinping. As Ford Authority reported yesterday, Trump will issue a memorandum directing federal agencies to evaluate U.S. trade relationships with other countries, as well as existing trade policies, and will instruct those agencies to investigate existing trade deficits and rectify them, as well as address unfair currency policies and trade practices that currently exist. That includes reviews of China’s 2020 trade deal with the U.S., as well as the United States-Mexico-Canada Agreement (USMCA).
A senior official within the Trump Administration noted that this action is intended to present the vision for the President’s trade policy “in a measured way,” a more deliberate approach that would presumably lay the groundwork for potential changes. For months now, rumors have suggested that Trump planned to implement tariffs on day one of his presidency, but others have stated that such calls are merely a negotiation tactic.
Ford has been in contact with Trump for some time now, even donating $1 million and a number of vehicles for his inauguration yesterday. In spite of these proposed tariffs and other potential policy changes – such as ending the current federal clean energy tax credit – the automaker remains confident that it can weather whatever political storms it may face as a result.
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Make America Smart Again!
Wells Fargo estimates that 25% tariffs on Mexico and Canada imports would put most of the adjusted earnings of General Motors,
Ford Motor
and Stellantis
at risk. The firm estimates the impact of 5%, 10% and 25% tariffs to be $13 billion, $25 billion and $56 billion, respectively, across the three companies.
Most notably, GM and Stellantis both have massive plants in Mexico that produce highly profitable full-size pickup trucks. They, along with Ford and others, also have built EVs in Mexico to lower costs.
Same comment as I left on the other tariff article. NAFTA was replaced by the USMCA (United States-Mexico-Canada Agreement) in July of 2020.
Is it more than just a name change? Trump seems to be violating his own agreement.
Trump is a loser
So you like good paying jobs being offshored, or sent just across the line because you have TDS? Got it…
Ford and others can’t just snap their fingers and move all operations to the United States. The shareholders like the lower costs from other countries.
Trump should put an ugly tariff on the Maverick.
Great idea make prices higher so even less people can afford a new vehicle.