Ford CEO Jim Farley has warned that the Trump administration’s tariffs will cost the automaker $2 billion, a significant increase from its previous forecast of $1.5 billion. The tariff bill is expected to saddle the company with a substantial expense as it faces increased costs due to reduced tariffs on Japan.
Farley stated that the change in trade policy would give Japanese automakers a “meaningful” cost advantage over their US rivals. He attributed this to lower labor costs, favorable exchange rates, and reduced tariffs. The effect of these changes can be seen in the prices of vehicles such as the Ford Escape and Toyota Rav4.
Ford is taking steps to minimize its tariff expenses while working with the Trump administration. However, Farley emphasized that the company’s strategy is not focused on competing in commodity segments where costs are low. Instead, it aims to compete in higher-value areas where profits can be maintained despite increased tariffs.
The news has led to a decline in Ford’s shares, falling by 1.6% in after-hours trading, despite a year-to-date gain of 9.8%.
Source: https://www.businessinsider.com/ford-trump-tariffs-cost-2-billion-benefit-japanese-rivals-2025-7