Ford Joins Automakers Warning of $14 Billion Cost from 25% Vehicle Tariffs
Ford joined General Motors and Stellantis in a February 20 letter urging President to delay a proposed 25% tariff on imported vehicles, warning it would add up to $12,000 on some models and cost the U.S. auto industry $14 billion annually. The Supreme Court declined to reinstate 2018 Section 232 auto tariffs, prompting exploration of alternative trade authorities.
1. Automakers’ White House Appeal
On February 20, Ford, General Motors and Stellantis sent a joint letter to the White House requesting a delay of a planned 25% tariff on imported vehicles. The letter warned that the duty could tack up to $12,000 onto certain models and impose $14 billion in extra annual costs across U.S. production.
2. Supreme Court Decision Outcome
The Supreme Court declined to reinstate former President Trump’s 2018 Section 232 auto tariffs, closing off the primary legal channel for those duties. This decision leaves the administration to seek other statutory authorities to impose similar levies.
3. Exploration of Alternative Trade Authorities
Administration officials are weighing use of the International Emergency Economic Powers Act or Section 301 of the Trade Act to impose new vehicle tariffs. These avenues would bypass Section 232’s national security basis and could lead to comparable levy levels.
4. Implications for Ford’s Costs and Pricing
Analysts estimate Ford could absorb roughly $3 billion in additional manufacturing costs if a 25% vehicle import tariff takes effect. The company may need to cut margins or pass price increases to consumers in key SUV and truck segments.