Ford income falls 65 per cent as Trump's tariffs bite

West Australian

3 days ago

Ford has postponed its full-year financial forecast, and announced US President Donald Trump's tariffs introduced in April will cost it $US2.5 billion ($A2.32 billion) and as much as $US1.5 billion ($A2.32 billion) in 2025 alone.
The carmaker reported a 65 per cent fall in profits for the first three months of 2025 despite tariffs not coming into effect until April 3.
Ford is the second carmaker in a week to drop its forecast with arch-rival General Motors (GM) – which said it's set to lose $US5-6 billion due to the tariffs – pushed its investor call after President Trump softened tariffs.
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The President's move gave carmakers temporary relief from tariffs on steel, aluminium and other imports being applied in addition to the standard automotive tariff.
The automotive tariff – separate to additional
'reciprocal tariffs'
announced later – applies
a 25 per cent duty
on vehicle imports into the United States (US).
A secondary tariff applying to 'key' automotive parts came into force on May 3, 2025, further impacting supply chains for US carmakers.
Ford has previously said
it expected to be less impacted
than most rivals as it has a large US manufacturing footprint, although it still produces the
Mustang Mach-E
electric SUV, for example, in Mexico.
It will also follow through with plans to increase highly profitable Ford F-Series Super Duty production in Ontario, Canada. The Super Duty name is set to arrive in Australian showrooms in 2026 on a tougher version of the
Ranger
.
On Monday, May 5 the carmaker said it would not issue its usual forecast, saying the uncertainty around the tariffs prevented an accurate picture of the business for the remainder of 2025.
'Given material near-term risks, especially the potential for industry-wide supply chain disruption impacting production, the potential for future or increased tariffs in the US, changes in the implementation of tariffs including tariff offsets, retaliatory tariffs and other restrictions by other governments and the potential related market impacts, and finally policy uncertainties associated with tax and emissions policy, the company is suspending guidance,' a statement from Ford said.
'These are substantial industry risks, which could have significant impacts on financial results, and that make updating full year guidance challenging right now given the potential range of outcomes.'
It said it was on target to meet its previous forecast of between $US7-8.5 billion ($A10.83-13.15 billion) EBIT (Earnings Before Interest and Taxes) and will give its next update at the end of June 2025.
The US carmaker's EBIT fell 63 per cent to $US 1 billion ($A1.55 billion) in the first quarter (January-March) 2025, with revenue down five per cent to $US40.7 billion ($A62.96 billion).
Ford Pro, the brand's commercial vehicle unit responsible for the Ranger,
Transit
and
F-150
sold in Australian showrooms, made $US1.3 billion (A$2.01 billion) – but this was 56 per cent down on the same period in 2024.
The Blue Oval's 'Model e' electric car division – yet to turn a profit, which saw ex-Ford Australia President Kay Hart installed as its boss in February 2025 – is expected to have its best year to date.
It still posted a $US849 million loss ($1.31 billion) in the first quarter, but this was a substantial improvement over the $US1.3 billion ($A2.01 billion) loss over the same period in 2024.
'We are strengthening our underlying business with significantly better quality and our third straight quarter of year-over-year cost improvement, excluding the impact of tariffs,' Ford CEO Jim Farley said in a statement.
In postponing its earnings call, cross-town rival GM's chief financial officer, Paul Jacobson, told
Reuters
: 'The future impact of tariffs could be significant… we're telling folks not to rely on the prior guidance, and we'll update when we have more information around tariffs.'
US new vehicle sales were up 4.4 per cent year-on-year in the first quarter of 2025, led by Toyota ahead of Ford and GM, but with GM's 17 per cent year-on-year growth making it the only one of the trio posting a significant increase in sales.