Ford forecasts $2bn hit from Trump tariffs in 2019
Ford warns US steel, aluminum and regional levies could cost it around $2bn this year, exceeding earlier estimates and underlining broader impacts on the auto industry.
Ford Revises Tariff Cost Estimate to $2bn
Ford Motor Company says it now expects US tariffs on imported steel, aluminum and parts to cost around $2bn in 2019, up from previous estimates. The adjustment reflects extended levies on materials sourced from Canada and Mexico, where Ford operates major plants.
Regional Duties and Global Strategy
Chief Financial Officer Sherry House cited higher-than-anticipated duties in North America, alongside President Trump’s steel and aluminum levies, as primary drivers of the increased cost forecast. Ford, which produces most vehicles in the United States, faces a less severe tariff burden than some rivals but still absorbs substantial expenses.
Industry-Wide Implications
General Motors and Volkswagen have reported tariff-related costs exceeding $1bn and $1.5bn respectively. Ford CEO Jim Farley said the company is negotiating with the White House to reduce tariffs on vehicle components, with potential for savings depending on the outcome.
Market Reaction
Following Ford’s announcement, shares dipped by 1.5% in after-hours trading in New York. The tariff strategy under President Trump aims to incentivize reshoring of automotive manufacturing back to the US.
Ford warns that extended US tariffs on steel, aluminum and parts could shave $2bn from its 2019 earnings, highlighting ongoing challenges in global auto supply chains.
This topic was reported by BBC News.
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