President Donald Trump’s auto tariffs are expected to cost Ford $1.5 billion in 2025, but the automaker said it doesn’t foresee a major spike in overall U.S. car prices as a result.
According to Ford’s Chief Financial Officer, Sherry House, the company projects that car prices in the U.S. will rise modestly—between 1% and 1.5%—during the second half of the year due to new tariffs on imported vehicles and parts. The announcement was made during Ford’s first-quarter earnings release, which revealed a notable decline in profits.
The auto industry is still working through the financial implications of the tariffs, which include a 25% tax on imported cars and a similar levy on most auto parts. Some cost-offset mechanisms are available to automakers, but they won’t fully eliminate the impact.
House explained that, in the short term, carmakers may reduce promotional offers and incentives for customers, potentially pushing prices higher more quickly. She also suggested that new models arriving in the fall could carry increased sticker prices across the industry. However, she did not share details on Ford’s own pricing decisions.
A broader slowdown in vehicle sales is expected later this year, following a surge in consumer purchases in April as buyers sought to beat the tariff deadlines.
Ford anticipates being less affected than rivals such as General Motors, which has projected a potential $4 billion to $5 billion loss due to the tariffs. One reason for Ford’s relative resilience is its domestic production footprint—over 80% of the vehicles it sells in the U.S. are made at American assembly plants. That’s a higher share than many of its competitors, including GM.
Amid growing economic uncertainty linked to the tariffs, Ford has also decided to withdraw its previous full-year earnings outlook.
Last week, CEO Jim Farley mentioned in a televised interview that the company would continue its “employee pricing” promotion through July 4. However, he warned that the offer might not be extended further. For now, Ford is working to sell off its remaining stock of imported vehicles that entered the U.S. before the new tariffs were implemented last month.