Two of the Detroit Big 3 have fallen.
Tariffs were the first topic addressed on Ford’s F earnings call after the closing bell on Monday, as the world waited to see how the Blue Oval would respond to the new business reality in which the automotive industry finds itself.
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Ford President and CEO Jim Farley contextualized Ford’s first quarter performance as great… if you ignore the impact of tariffs.
“Ford supports the administration’s goal to strengthen the U.S. economy by growing manufacturing, and we also support a level playing field globally for domestic and foreign original equipment manufacturers (OEM),” Farley stated.
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“We also appreciate the ongoing cooperation we’ve had with the administration. As the country’s largest auto manufacturer, our engagement with Washington is helping U.S. policymakers better understand how the proposed policy changes will impact our industries and, of course, our communities.”
But the company also said that it would take time for OEMs to shift their production to the U.S. and that balancing all of this, including potential price increases for its customers, will cost Ford money.
A lot of money.
Compared to other carmakers, Ford produced far more vehicles in the U.S. last year.
Image source: Kowalsky/Getty Images
Ford estimates how much tariffs will cost this year
For the full year, Ford said it expects to take a $1.5 billion gross hit to EBITDA from the tariffs, though it also cautioned that it is still too early to fully gauge exactly how much disruption there will be to the global supply chain due to the duties that went into effect.
Due to that uncertainty, Ford is also suspending its guidance for the year, following in the footsteps of rival General Motors (GM) , which announced that it too was suspending its guidance due to tariffs last Tuesday.
Ford had expected EBITDA between $7 billion and $8.5 billion for the year.
Still, for Ford, the bottom line is that it has the largest production footprint in the U.S., so even if it experiences short-term pain due to tariffs, it is better positioned to withstand that discomfort than its competitors.
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Ford says it assembled more than 300,000 more vehicles in the U.S. than its closest competitor in 2024, including all of its pickup trucks.
However, Ford has stopped exporting vehicles to China for the time being due to the 145% tariffs China currently imposes on the U.S.
Ford shares fall following earnings call
Net income in the first quarter fell to $473 million, or 12 cents per share, about a third of the $1.33 billion, or 33 cents per share, the company reported a year ago.
Revenue for the quarter fell 5% to $40.66 billion.
Despite the pronounced dip in both earnings and revenue, Ford was able to top analyst estimates for the quarter. Wall Street expected the company to report flat earnings on revenue of $38.02 billion.
Despite the beats, the stock was down more than 2% after hours Monday.
Last week, GM announced that it is pulling its guidance for 2025 and pausing $4 billion in share buybacks until it gains more visibility on U.S. tariffs. It also pushed a conference call with analysts scheduled for Tuesday to May 1.
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“Because the original guidance didn’t include impact from tariffs, prior guidance can’t be relied upon,” Paul Jacobson, the company’s chief financial officer, said. “We will update when we have more information on tariffs.”
The company had previously expected to earn between $11 and $12 per share this year. It announced plans for $6 billion in new share buybacks in January, including $2 billion in the second quarter.
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