Tariffs Give Ford Big Advantage Compared To Rivals: Farley

President Donald Trump’s decision to impose 25 percent tariffs on imported vehicles back in early April has already impacted the automotive industry in various ways, and in some cases, automakers have raised prices in response. On the flip side, the tariffs have also motivated more than one automaker to at least contemplate the idea of moving production to the U.S., too. As Ford Authority reported yesterday, Ford’s large domestic manufacturing footprint – second only to Tesla – gives The Blue Oval a big advantage in that regard, which is something that CEO Jim Farley recently admitted as well.

“I mean, how exciting is it to go from being criticized for our U.S. plants – in every investor meeting I had, [hearing] why do you make so much in the U.S., why don’t you localize overseas, why don’t you do more of what your competitors do? – to actually be advantaged because we’re building an American car company and always have,” Farley said during a recent interview with the New York Post.

In another recent interview, Farley admitted that the automaker could consider moving production of vehicles like the Ford Maverick – which is currently assembled in Mexico – to the U.S., if the numbers make sense. “We’re not quite there yet,” he noted here, “but that’s the place we’re gonna be. If we made 100 percent of the parts in the U.S. and not [Ford’s current] 85 percent, that 15 percent times the U.S. premium for all the other things I mentioned would add thousands. For years, Ford “just had a lower margin … It cost us a billion dollars a year [to manufacture so much domestically], and Wall Street wasn’t happy with that,” the exec added.

As such, Farley has been meeting with the Trump administration and discussing ways it can balance affordability with increased domestic manufacturing. “[The White House and I are] working all those details every day. And I’m, very frankly, grateful,” Farley said. “They are really trying hard to work through the details. There are thousands of pieces in an F-150… we can’t make it without parts from China. China has decided vehicles are one of their key industries. [The US] can’t just hole up … and hope everything is fine. Personally, I watched the Australian government give up manufacturing, and they regret it deeply.”