Ford hikes prices on Mexico-produced models, citing tariffs: Reuters

Ford Motor has hiked prices on three of its Mexico-produced fashions efficient Could 2, turning into one of many first main automakers to regulate sticker prices following President Donald Trump’s tariffs.

Prices on the Mustang Mach-E electrical SUV, Maverick pickup and Bronco Sport will enhance by as a lot as $2,000 on some fashions, in keeping with a discover despatched to sellers, which was reviewed by Reuters.

Ford earlier this week stated Trump’s commerce warfare would add about $2.5 billion in prices for 2025, but it surely expects to scale back that publicity by round $1 billion. Rival Common Motors stated final week that tariffs had been projected to value it between $4 billion and $5 billion following the imposition of hefty levies on overseas imports of vehicles, but it surely anticipated to offset that by not less than 30%.

A Ford spokesperson stated the worth hikes will have an effect on automobiles constructed after Could 2, which might arrive at seller tons in late June. The spokesperson stated the worth hikes mirror “ordinary” mid-year pricing actions, “mixed with some tariffs we face. Now we have not handed on the complete value of tariffs to our prospects.”

Ford shares had been down 1.7% at $10.26 at noon. The automaker remains to be operating a reduction program by way of the July 4 weekend on a lot of its fashions, the spokesperson stated.

Trump’s tariffs have unleashed weeks of uncertainty throughout the auto sector, as main carmakers in the USA and Europe have pulled forecasts, shifted manufacturing and brought about firms to idle vegetation.

Following weeks of pushback from the auto trade, Trump softened his tariffs on overseas auto elements imports to offer carmakers credit for what’s produced within the U.S. and to keep away from double-tariffs on uncooked supplies utilized in auto manufacturing. Nevertheless, the White Home has not rescinded a 25% tariff on the 8 million automobiles the U.S. imports yearly.

Analysts have stated U.S. auto gross sales might drop by greater than 1 million automobiles a 12 months if tariffs had been to stay in place.

Ford is in a greater place to climate tariffs than a few of its opponents due to its robust U.S. manufacturing base. The Dearborn, Michigan, automaker assembles 79% of its U.S.-sold automobiles domestically, in contrast with GM’s 53%, Barclays analysts stated in a word.

Nonetheless, Ford imports one in all its most inexpensive and well-liked automobiles, the Maverick, from Mexico. Most main U.S. automakers face important worth hikes on their cheaper fashions produced within the nation.

Ford and GM additionally face important levies on imports from China and South Korea, respectively. GM estimated that the prices on its Korean imports totaled about $2 billion, whereas Ford declined to specify the bills round importing automobiles from China.

Automakers that rely on exports to the USA are dealing with elevated pricing stress. A dozen main automakers together with Toyota and GM import not less than 40% of the automobiles they promote within the U.S., with some corresponding to Volkswagen and Hyundai Motor importing greater than 60%, in keeping with 2024 knowledge from S&P International Mobility.

Earlier than Ford’s transfer, most automakers had not taken the step of boosting prices, however had warned that was on the best way.

Porsche stated it must increase its promoting value if tariffs remained in place whereas U.S. Volkswagen’s Audi model additionally instructed potential worth will increase, with out offering any particulars.

Against this, BMW expects U.S. automobile tariffs to say no from July, primarily based on its contacts with U.S. officers – a extra upbeat evaluation of the commerce local weather than many rivals. GM’s finance chief, Paul Jacobson, advised analysts final week that the automaker was not anticipating imminent worth will increase, saying they “be ok with the place the pricing surroundings is at the moment.”