Ford CEO Jim Farley Warns of Devastating Impact from U.S. Tariffs on Mexico, Canada
Ford’s chief executive officer, Jim Farley, has criticized the impending 25% tariffs on imports from Mexico and Canada, scheduled for March, expressing concern about their potential impact on domestic automakers. Speaking at the Wolfe Research conference, Farley described these tariffs as bringing “a lot of cost and a lot of chaos” to the automotive sector.
Farley’s concerns are not isolated; they echo broader industry apprehensions that these tariffs could increase costs, disrupt supply chains, and pose broader economic challenges. The CEO noted that over 80% of Ford vehicles sold in the U.S. are manufactured domestically. Yet, extended tariffs would still raise consumer prices and disturb the industry’s equilibrium.
The selective nature of these tariffs—targeting Mexico and Canada while sparing South Korea and Japan—has also drawn criticism from Farley. He argued that this policy creates a “bonanza” for foreign competitors like Hyundai, Kia, and Toyota, advocating for a more balanced approach to protect the U.S. auto industry.
Beyond tariffs, Farley has also expressed concern over potential shifts in federal policies, particularly the possible repeal of the Inflation Reduction Act. This act provides subsidies for U.S.-based electric vehicle (EV) and battery production, which Ford is heavily investing in across states like Tennessee, Ohio, Michigan, and Kentucky. Farley warned that reversing these incentives could threaten jobs and investments in these regions.
Moreover, Farley has highlighted the growing challenge posed by Chinese EV manufacturers, describing them as an “existential threat” to U.S. automakers. He cautioned that the industry needs supportive policies to stay competitive in the global market.
In response to the tariff uncertainty, Ford is reportedly exploring strategies like stockpiling inventory to mitigate potential disruptions. However, Farley emphasized that a more certain and balanced trade policy would be crucial for the U.S. auto industry’s long-term strength and competitiveness.