Earlier this week, U.S. President Donald Trump signed an executive order imposing a 25 percent tariff on all imported vehicles, which is set to take effect on April 3rd, 2025, after which the U.S. will place levies on imported parts that don’t comply with the current United States-Mexico-Canada Agreement, such as engines, transmissions, and electrical components, no later than May 3rd. Many have speculated that these tariffs could lead to price increases for vehicles, but Trump apparently warned automakers including Ford not respond in that manner.
According to The Wall Street Journal, Trump told Ford and other automakers not to raise prices in the wake of these new tariffs on a recent call that Blue Oval CEO Jim Farley was part of. Trump reportedly told those automotive executives that the White House “would look unfavorably on such a move, leaving some of them rattled and worried they would face punishment if they increased prices.” It’s unclear what, exactly, the administration might do if automakers do wind up raising prices.
At the moment, it’s also unclear how automakers like Ford will ultimately respond to these new tariffs. Most have noted that it takes time to shift supply chains and production, with Blue Oval CEO Jim Farley stating that imposing these levies could cause “chaos” in the industry, though he also supports universal tariffs. The Ford-backed lobby group Alliance for Automotive Innovation believes that prices will go up as a result of the tariffs, while Barclays predicts that they will add around $400 to the production cost of every vehicle built.
Regardless, Ford stands to be impacted in a lesser way than many of its peers, based on how many vehicles it builds in the U.S. for that market, as well as the percentage of parts that are also sourced from or built by American companies. In fact, 80 percent of the vehicles that Ford sells in the U.S. are assembled in that country, totaling around 2.1 million units in 2024. Every single Ford F-Series truck is built in America in Michigan, Missouri, Kentucky, and Ohio, totaling around one million units, and Ford also employs around 57,000 hourly manufacturing workers in the U.S., too. On top of that, Ford’s U.S. dealer network employs over 170,000 people across nearly 3,000 locations.
Comments
2026 MSRP]s will go up to compensate for the tariffs.
This is clear example example of Trump’s very poor business acumen. He doesn’t understand cost of goods, costs of manufacturing, operating margins, dealership arrangements and contracts as well as other operations.
Failed six times at his own businesses and still hasn’t learned anything.
I think Trump understands the cost of goods. After all lot of his things are made in China or elsewhere that he sells or wears. Save your money folks.
These automakers could have been building their cars in America for decades past. In addition, they played their hand wrong and Trump recaptured the Presidency. Build it here with American labor and American parts and ZERO tariffs. I’m just confused as to why this is so hard to understand? I’m glad someone is willing to support American Labor!
Ford has raised its MSRPs over 40 percent above and beyond inflation in a greedy move to make more profits so this could be absorbed with no problem.
🙏