Ford Withdraws 2025 Forecast Amid Tariff Uncertainty \ Newslooks \ Washington DC \ Mary Sidiqi \ Evening Edition \ Ford Motor Co. has withdrawn its 2025 financial guidance after projecting a $1.5 billion operating profit hit from tariffs. First-quarter earnings fell 65%, though revenue slightly beat analyst expectations. CEO Jim Farley emphasized Ford’s U.S. manufacturing advantage amid uncertain global trade conditions.
Quick Looks
- Ford projects a $1.5 billion hit to 2025 profits due to tariffs.
- Q1 earnings plunged by two-thirds, with net income at $473 million.
- Revenue dropped 5% to $40.66 billion, though it beat forecasts.
- Ford withdrew its full-year forecast, citing evolving U.S. trade policy.
- CEO Jim Farley highlighted Ford’s U.S. production advantage.
- Trump’s new trade policy complicates global supply chains, especially rare earth materials.
- Tariffs expected to hurt GM more than Ford or Tesla due to assembly locations.
- Ford stock fell over 2% in after-hours trading after earnings call.
Deep Look
Ford Motor Co. finds itself navigating one of the most uncertain financial landscapes in years, as the automaker braces for a projected $1.5 billion hit to its 2025 operating profit—an impact largely attributed to shifting U.S. trade policies and heightened tariffs under former President Donald Trump’s evolving economic agenda. The company, facing an already challenging environment marked by weakening revenue and sliding profits, made the rare move of withdrawing its full-year financial guidance, citing the unpredictable range of outcomes from the latest tariff developments.
Ford announced Monday that its net income fell by approximately 65% year-over-year in Q1, from $1.33 billion (or 33 cents per share) in the same period last year to $473 million (or 12 cents per share) this quarter. Revenue dropped 5% to $40.66 billion, though that figure still surpassed analyst forecasts, which predicted $38.02 billion in revenue, according to FactSet. The better-than-expected top-line performance didn’t stop Ford’s stock from sliding more than 2% in after-hours trading, as investors reacted to the warning signs surrounding the company’s full-year outlook and macroeconomic uncertainty.
Ford originally forecast its 2025 earnings before interest and taxes (EBIT) to range between $7 billion and $8.5 billion. However, Monday’s announcement made it clear that the volatile policy landscape—particularly around tariffs—has rendered such projections untenable for now.
“The risks associated with tariffs make updating full-year guidance challenging right now, given the potential range of outcomes,” the company said in a statement. The abrupt change in forecast underscores just how deeply recent trade developments have rattled one of America’s most iconic manufacturers.
At the heart of the issue are the Trump administration’s recently modified tariffs on imported automobiles and parts. While the White House has offered temporary relief on the 25% tariff rate, automakers remain deeply concerned about the broader implications. According to independent industry analysts, these tariffs have the potential to raise production costs, disrupt supply chains, increase vehicle prices, and make U.S.-based manufacturing less competitive on the global stage.
Last week, General Motors warned that it could face up to $5 billion in tariff-related costs in 2025, signaling the wide-reaching impact across the auto industry. While Ford and Tesla are expected to suffer slightly less due to their heavier domestic production footprints, the implications for Ford are still significant.
On an earnings call with analysts, Ford CEO Jim Farley tried to strike a confident tone, reiterating the advantage Ford has thanks to its larger U.S.-based manufacturing network. “Automakers with the largest U.S. footprint will have a big advantage, and, boy, that is true for Ford. It puts us in the pole position,” Farley said. However, he also acknowledged that the full scope of disruption is still unfolding. “It’s too early to gauge the related market dynamics, including the potential industrywide supply chain disruptions.”
This cautious optimism may prove difficult to maintain as the ripple effects of trade policy continue. Farley emphasized that while Ford is better positioned than some rivals, the uncertainty around sourcing, raw material access, and part availability could affect everyone. That concern was echoed by Chief Operating Officer Kumar Galhotra, who warned that even minor component delays—particularly for parts dependent on Chinese suppliers—could grind production to a halt.
“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,” Galhotra said. “It would take only a few parts to potentially cause some disruption into our production.”
Ford’s warning is part of a broader trend in the auto industry as manufacturers contend with increasing global volatility. Supply chain fragility, especially in light of U.S.-China trade tensions, is exposing the vulnerabilities of a just-in-time manufacturing system that has long been the industry standard. Moreover, electric vehicle components, including batteries and chips—many of which rely on imports from Asia—are under heightened scrutiny.
President Trump has framed the new tariffs as a means of repatriating American manufacturing, encouraging automakers to shift production back to U.S. soil. Last week, he signed executive orders easing certain automotive tariffs, claiming the temporary relief would give companies the time and flexibility needed to reconfigure their supply chains. But for companies like Ford, which already assemble a significant portion of their vehicles domestically, the measures offer little immediate clarity and even less long-term assurance.
Industry advocates and some economists warn that the tariffs could backfire by raising vehicle prices for consumers, reducing sales volumes, and ultimately threatening domestic jobs if production becomes financially unsustainable. In Ford’s case, the withdrawal of guidance signals that even well-prepared companies are struggling to model a coherent business plan in this volatile environment.
Despite these headwinds, Ford is attempting to remain strategic. The company continues to expand its investments in electric vehicles, battery innovation, and AI-powered vehicle platforms, but all of those efforts hinge on global sourcing and stable logistics. Tariff-related complications, if unresolved, could slow or even stall key initiatives.
Looking ahead, Ford will likely be under pressure from both Wall Street and Washington. Investors want clearer answers on how the company will navigate tariffs, preserve profit margins, and avoid production disruptions. Policymakers, meanwhile, may face increasing backlash from the industry if the tariffs prove more harmful than helpful.
In the meantime, Ford’s executives are treading carefully. “We’re in a moment of real transition,” Farley concluded. “There’s risk, there’s opportunity, and above all, there’s uncertainty. That’s why flexibility, speed, and resilience will define the winners in this next era.”
Ford Withdraws 2025 Ford Withdraws 2025
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