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Home Consumer Cyclical Auto Manufacturers

Ford CEO Warns Trump’s Tariffs Are Disrupting U.S. Auto Industry

byLuca Blaumann
February 11, 2025
in Auto Manufacturers, Large-Cap
Reading Time: 2 mins read
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Jim Farley Calls 25% Tariffs a Costly and Chaotic Burden

Ford Motor (F) CEO Jim Farley has raised concerns over former President Donald Trump’s proposed and implemented tariffs, calling them a source of “chaos” for the U.S. automotive industry.

Speaking at a Wolfe Research conference, Farley criticized the 25% tariffs on steel and aluminum, as well as potential levies on imports from Mexico and Canada, stating that they are driving up costs and creating uncertainty. While he acknowledged Trump’s goal of strengthening the domestic auto industry, he argued that so far, the impact has been more financial burden than economic benefit.

Ford sources most of its steel and aluminum domestically, but its supply chain still relies on imports, meaning additional tariffs could significantly increase costs. Ford’s incoming CFO, Sherry House, echoed Farley’s concerns, noting that even minor cost increases from suppliers accumulate into a major financial strain on the company.

Farley expressed particular concern over a long-term 25% tariff on Mexican goods, set to take effect March 1, warning that such a move could be “devastating” and “blow a hole” in the U.S. auto industry.

To address these concerns, Farley is heading to Washington, D.C., for the second time in three weeks to meet with lawmakers and government officials. He urged a comprehensive approach to tariffs, highlighting that automakers like Toyota and Hyundai import hundreds of thousands of vehicles from Japan and South Korea with little to no duties, while the U.S. industry faces steep tariff hikes.

Ford, the largest U.S. auto producer, remains vocal about its commitment to American manufacturing, but these rising trade costs threaten its competitive edge.

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