US President Donald Trump’s latest trade deal with Japan, the EU, and South Korea has hit America’s biggest carmaker, Ford, hard. The Detroit-based company assembles 80% of its US-sold vehicles domestically but still relies on imported parts and aluminum, which now face punishing duties. The new tariffs will make it difficult for Ford to compete, especially with rival Japanese companies like Toyota that will face lower tariff rates.
Ford expects to pay $2.5 billion in tariffs over the next year alone, a significant burden on its already competitive strategy. Analysts say Trump’s move contradicts his aim to promote Made-In-America manufacturing and level the playing field for US automakers globally.
The new trade deal has introduced 15% tariffs on imported cars from Ford’s rivals Toyota, VW, and Kia, while auto parts face higher rates of up to 25%. Additionally, aluminum imports are subject to a 50% tariff. This will increase costs for businesses like Ford, leading to higher sticker prices for consumers and reduced financing deals.
The impact on the US car industry has been significant, with businesses such as GM and Stellantis investing heavily in manufacturing in Mexico and Canada before the trade war began. The latest development has raised concerns about the effectiveness of Trump’s trade policies, which have already caused chaos in various industries.
Source: https://www.dailymail.co.uk/yourmoney/article-14962947/Trump-tariff-loop-hole-cars-US-Ford.html