Ford CEO Jim Farley Says Trump's Tariffs Could Cost Ford $1.5 Billion, Pulls Its Earnings Guidance

Ford Motor Co. F said Donald Trump's auto tariffs could cost the company $1.5 billion.

What Happened: "We've estimated the gross impact of tariffs for full year total company EBIT of $2.5 billion and a net impact of $1.5 billion," Ford CEO Jim Farley said to investors in the company's earnings call on Monday.

The company also decided to pull its earnings guidance for the year, citing uncertainty around the Trump administration's tariffs. "It's still too early to fully understand our competitors' responses to these tariffs," Farley said and went on to highlight how the company believes it can't predict supply chain disruptions due to the tariffs.

"As a result, we've decided to suspend our guidance." Farley shared with investors at the earnings call.

However, the CEO also reiterated that the company's domestic footprint will provide Ford with an advantage over its competitors. "It's clear, however, that in this new environment in which automakers with the largest US footprint will have a big advantage," Farley said. Ford manufactures over 80% of its vehicles domestically.

Why It Matters: The update comes in as Ford beat analyst expectations for the quarter, earning 14 cents per share rather than 2 cents, which analysts predicted.

The Detroit-based automaker also beat analyst expectations of total revenue, which was $37.42 billion, over a billion dollars more than the predicted figure of $36.2 billion.

Ford had recently announced it would extend the employee pricing program through the summer, which could help the company get a boost in sales as tariff uncertainty looms.

Ford isn't the only company to be hit by the tariffs, as General Motors Co. GM CEO Mary Barra recently shared that GM could face $5 billion in costs due to Trump's tariffs.

President Trump's tariffs have cast a lot of uncertainty over the U.S. auto industry, with experts suggesting that companies could lose well over $100 billion due to tariffs.

However, the administration has announced that it will provide relief to the auto sector by preventing ‘stacking' of tariffs, as well as alleviating some of the duties levied on imports.

Price action: F stock currently trades for $10.17 on the NYSE, according to Benzinga Pro data.

Check out more of Benzinga’s Future Of Mobility coverage by following this link.

Read Next: