Ford Revises Tariff Hit Estimate Again – And It's Not Pretty
Ford has updated its financial guidance again for 2025, noting that tariffs will dent profits by a $3 billion gross amount, up from $2.5 billion. The automaker incurred $800 million in tariff-related expenses last quarter, and its 2025 earnings before interest and tax (EBIT) are now $6.5 billion to $7.5 billion, down from February's forecast of $7 billion and $8.5 billion. This rise in anticipated tariff costs stems from Ford's imports of vehicle parts, steel, and aluminum, along with levies on Mexico and Canada remaining higher for longer than expected. Ford's tariff bill from Q2 eliminated its net profit, resulting in the company's first quarterly loss since 2023.
Ford F-150 Lightning —
Source: Getty Images
How Ford's responding to its tariff burden
Ford Chief Financial Officer (CFO) Sherry House said that the manufacturer is in near-daily contact with Washington discussing ways to reduce tariff expenses. House described the interactions as 'constructive conversations' centered around steel and aluminum tariffs, according to NBC4 Los Angeles. The Ford CFO added: 'They've [Trump administration] made it clear that Ford, as the most American automaker, should not be disadvantaged,' The Wall Street Journal reports.
Ford's extensive network of domestic production facilities is helping the company fare slightly better than General Motors (GM), which reported that it lost $1.1 billion in Q2 due to tariffs, with a predicted $4 billion to $5 billion hit for the year. GM expects to offset 30% of its 2025 gross tariff losses, and Ford said it can offset $1 billion. Stellantis shared on Tuesday that import levies will reduce its earnings this year by about $1.7 billion, but while this amount is lower than Ford's and GM's, it posted a $2.65 billion net loss in the first half of 2025 alone.
A closer look at Ford's tariff troubles—and what could happen next
Around 80% of the vehicles that Ford sells in the U.S. are produced domestically, about 25% more than GM and Stellantis. Still, Ford relies heavily on imported components for segments such as electric vehicles (EVs) and hybrids. President Trump set an August 1 deadline for most countries to finalize trade deals with the U.S. or face elevated tariffs. While the European Union, South Korea, and Japan reached a 15% import agreement with the US, Ford continues to face steeper tariffs on many parts. Trump's administration doubled steel and aluminum tariffs to 50%, raising costs for material suppliers and causing consumers to absorb the additional expenses. Ford recently finished extending its employee discount to all customers on most of its inventory, and the automaker may raise prices on EVs and hybrids shortly to recoup some profit losses from tariffs. Consumers may also see Ford cut back on incentives and discounts for fleet and commercial purchases.
Ford dealership in Richmond, California —
Source: Getty
Final thoughts
Ford's tariff bill is better than GM's thanks to its strong domestic manufacturing presence, but the outlook could be better. GM's Q2 tariff bill was $300 million more than Ford's—an amount that seems like it should be higher given that Ford produces about 25% more domestic vehicles than GM. However, Ford's reliance on imported components for segments like EVs is costing the company significantly, underscoring the importance of timely White House negotiations as other countries strike trade deals and reduce tariff rates.
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