Ford CEO Raises Concerns over Tariffs, Calls for Fair Treatment
Ford Motor Company CEO Jim Farley has expressed concerns over the impact of prolonged tariffs on the automotive industry, particularly those targeting imports from Mexico and Canada. Farley warned that such measures could have a "devastating impact" on the sector, potentially wiping out billions in profits.
Farley also criticized the current tariff scheme, which he said unfairly targets certain countries while allowing others to import vehicles without paying any tariffs. He specifically highlighted Hyundai-Kia and Toyota as examples of companies that benefit from importing large numbers of vehicles into the US without facing additional costs.
"What doesn’t make sense to me is why we’re having this conversation while Hyundai-Kia is importing 600,000 units into the US with no incremental tariff, and why is Toyota able to import a half a million vehicles into the US with no incremental tariffs?" Farley said.
He emphasized the need for a comprehensive tariff policy that applies equally to all automakers, rather than selectively targeting certain countries or regions.
While Toyota does not pay incremental tariffs on vehicles imported from Japan, it does pay a 2.5% tariff. Hyundai and Kia, on the other hand, source 67% of their US sales from vehicles made in Korea, with the remainder coming from US assembly plants and Mexico. The two companies combined for 1.7 million vehicle sales in the US last year.
Farley's focus on fairness in tariffs may not align with the priorities of President Trump, who has targeted countries near the US border. However, Farley believes that Ford is better positioned than its competitors in the event of a trade war with Canada and Mexico, as it has the largest US-based manufacturing operations and production facilities for its F-Series trucks.