Ford CEO says Trump's tariff changes are helpful, but still not enough
Ford CEO: Trump’s Auto Tariff Changes Help But More Support Needed
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Recent Tariff Policy Changes
In a significant development for the automotive industry, President Donald Trump has signed an executive order implementing changes to automotive parts tariffs. Speaking at a launch event for the 2025 Ford Expedition at Ford’s Kentucky Truck Plant, CEO Jim Farley acknowledged these changes as helpful while emphasizing the need for more comprehensive policy support.
Key Policy Changes
- Reimbursement system for U.S. parts usage
- Reduction in tariff “stacking” effects
- Continuation of 25% tariff on imported vehicles
- Two-year partial reimbursement qualification for U.S.-assembled vehicles
Impact on Auto Industry
The automotive industry had been seeking relief amid regulatory uncertainty, particularly concerning the 25% tariffs on imported vehicles and the impending 25% tariff on automotive parts scheduled for May 3. The new measures aim to ease the cumulative impact of multiple tariffs while maintaining protection for domestic manufacturing.
Farley emphasized that while these changes will help mitigate the impact on automakers, suppliers, and consumers, there’s still a need for a more comprehensive policy framework to support the industry’s growth and sustainability.
Ford’s Manufacturing Perspective
As the largest vehicle producer in the United States, Ford holds a unique position in the industry. The company reports being a net exporter of both parts and vehicles based on total value, highlighting its significant contribution to American manufacturing.
Potential Industry Growth Scenarios
Farley outlined several potential benefits if competitors matched Ford’s manufacturing commitment to the U.S.:
- 4 million additional vehicles produced annually
- 15 new manufacturing facilities
- Over 500,000 new manufacturing jobs
- Strengthened domestic supply chains
Future Policy Needs
Ford’s CEO emphasized two critical areas for future policy development:
- Export Incentives: Policies that encourage and reward U.S. companies for exporting American-made vehicles globally
- Supply Chain Support: Measures to ensure affordable parts availability while promoting domestic growth and vehicle affordability
While Ford continues to import vehicles and parts from Mexico, Canada, and China, the company advocates for policies that would make domestic manufacturing more competitive and sustainable in the global market.
Published on May 3, 2025
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