Ford says its Q1 profit fell by two-thirds and it expects a $1.5 billion
hit from tariffs this year
[May 06, 2025]
DEARBORN, Mich. (AP) — Ford Motor Co. says it expects to take a $1.5
billion hit to its operating profit from tariffs this year and is
withdrawing its full-year financial guidance due to the uncertainty
created by the Trump administration's evolving trade policy.
Ford said Monday that its net income fell by about two-thirds in the
first quarter to $473 million, or 12 cents per share, from $1.33
billion, or 33 cents per share in the year-earlier quarter. Revenue
dropped 5% to $40.66 billion.
The results topped the expectations of analysts surveyed by FactSet, who
forecast earnings per share for the quarter would be flat. Revenue was
forecast to be $38.02 billion. Still, the stock fell more than 2% in
after-hours trading.
Last week, General Motors said it is bracing for a potential impact from
auto tariffs as high as $5 billion in 2025. Ford and Tesla are expected
to see a smaller impact from tariffs than GM and other automakers
because they assemble more of their cars in the U.S. Still, what impact
they do see won't be insignificant.
Ford originally forecast 2025 earnings before interest and taxes in a
range of $7 billion to $8.5 billion, but on Monday the company said the
risks associated with tariffs “make updating full year guidance
challenging right now given the potential range of outcomes.”
Ford CEO Jim Farley has been touting the advantage that higher domestic
production gives his company and he did so again Monday, while
acknowledging that the shake-up to the industry from tariffs is still in
its early stages.
“It’s too early to gauge the related market dynamics, including the
potential industrywide supply chain disruptions,” said Farley said on an
earnings call with analysts. “Automakers with the largest U.S. footprint
will have a big advantage, and, boy, that is that true for Ford. It puts
us in the pole position.”
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Jim Farley, President and Chief Executive Officer of Ford, speaks at
the Ford Motor Company Kentucky Truck Plant to launch the 2025 Ford
Expedition, Wednesday, April 30, 2025, in Louisville, Ky. (AP
Photo/Carolyn Kaster)
 President Donald Trump says one goal
of his trade policy is to move more manufacturing of products such
as autos back to the U.S. Last week Trump signed executive orders to
relax some of his 25% tariffs on automobiles and auto parts in a
move the president said would allow automakers more time to
transition their manufacturing operations.
Automakers and independent analyses have indicated that the tariffs
could raise prices, reduce sales and make U.S. production less
competitive worldwide.
The potential impact of tariffs dominated Ford's earnings calls,
with one executive noting how just a little trouble with a few parts
could have a dramatic effect.
“The rare earth materials from China, for example, how they are
imported, not just for us, but for the entire industry, has become
rather complicated over the last few weeks,” said Chief Operating
Officer Kumar Galhotra. “It would take only a few parts to
potentially cause some disruption into our production.”
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