Ford Motor CEO Jim Farley says former President Trump’s recent executive order easing certain auto tariffs offers short-term relief, but comprehensive support is still lacking for long-term U.S. auto industry growth.
Executive Order Reduces Tariff “Stacking” but Leaves Core Issues Untouched
On Tuesday, Donald Trump signed an executive order providing partial reimbursement on U.S. auto parts and reducing compounded tariffs, addressing complaints from automakers facing regulatory ambiguity. The new measures aim to soften the cumulative effect of layered tariffs, including the ongoing 25% import tax on foreign vehicles and a separate 25% duty on auto parts due to take effect May 3.
Jim Farley described the revisions as “helpful,” but emphasized that more significant steps are needed to stabilize and grow the American automotive sector. Speaking at the launch of the 2025 Ford Expedition in Kentucky, he said, “We are not there yet.”
Ford Pushes for Export-Friendly and Production-Centric Policies
Farley called on policymakers to implement strategies that incentivize U.S. manufacturing and exports. “So many of the vehicles we build here are exported globally. Shouldn’t we get credit for that?” he said. He stressed the importance of rewarding companies like Ford for producing vehicles domestically and helping secure affordable parts for consumers and supply chain resilience.
Ford claims to be a net exporter of vehicles and parts by total value and nearly so on a per-vehicle basis — meaning it exports more than it imports, a rarity in the industry.
Hypothetical Growth: What If Rivals Matched Ford’s U.S. Output?
Farley laid out a vision for national economic impact if competitors matched Ford’s domestic production efforts. According to his estimates, this would add 4 million vehicles annually, create 15 new manufacturing plants, and generate over 500,000 jobs in the U.S. auto sector.
Yet, he acknowledged that Ford still imports parts and vehicles from Mexico, Canada, and China, highlighting the complexity of the global supply chain.
Tariff Adjustments Aim for Balance, But Long-Term Uncertainty Remains
While the 25% tariff on imported cars remains intact, the order offers partial relief for final-assembled U.S. vehicles affected by the upcoming parts tariff — allowing reimbursements for two years. However, the broader question remains: Will the administration follow through with deeper reforms that go beyond temporary fixes?
Will the U.S. Government Align Industrial Policy with Domestic Auto Leadership?
Ford’s message is clear: tactical changes are not enough. As the auto industry braces for further disruption, the next administration’s willingness to adopt a holistic policy approach could determine the long-term fate of American manufacturing.
