Ford Reinstates 2025 Outlook, Braces for US$2 Billion Tariff Hit

Ford reinstated its full-year 2025 financial outlook after suspending it in May due to ongoing US auto tariffs. The updated guidance incorporates an estimated net impact of US$2 billion from tariffs, with the company projecting a gross impact of US$3 billion and identifying mitigation strategies to offset US$1 billion of that amount.

Chief Financial Officer Sherry House stated that Ford remains in "near-daily communication" with the Trump administration and described the discussions as "constructive," particularly on steel and aluminum tariffs. “We make about 80% of our vehicles in the United States, but we still import parts from all over the world,” said CEO Jim Farley in an interview with CNBC. “That is the opportunity—to work with the administration. They are very committed to supporting companies like Ford that have invested in the US manufacturing base.”

For the second quarter, Ford reported total revenue of US$50.2 billion, a 5% year-over-year increase, beating analyst expectations of US$43.21 billion in automotive revenue. Adjusted earnings before interest and taxes (EBIT) came in at US$2.14 billion, including US$800 million in adverse tariff-related impacts. Net income showed a loss of US$36 million, attributed to “special charges,” including a US$570 million recall of over 694,000 SUVs and expenses tied to the cancellation of an EV program. In the same quarter last year, Ford reported US$1.83 billion in net income.

Ford’s revised full-year outlook now forecasts adjusted EBIT between US$6.5 billion and US$7.5 billion, down from the previous range of US$7 billion to US$8.5 billion issued in February, prior to the inclusion of tariff impacts. Adjusted free cash flow guidance remains unchanged at US$3.5 billion to US$4.5 billion, and capital expenditures are expected to total approximately US$9 billion.

The automaker sold 612,095 vehicles in 2Q25, a 14.2% year-over-year increase. Electrified vehicle sales rose 6.6% to 82,886 units, although pure EV sales declined 31.4%, while hybrid sales increased 23.5%. Farley noted that Ford is adjusting its EV strategy in response to recent federal policy shifts, including the anticipated expiration of EV tax credits on September 30 and the EPA’s planned repeal of certain greenhouse gas regulations. “We are out of sync—in a good way—with our competitors who are now fully loaded with all their EVs,” Farley said on the analyst call.

The company’s “Blue” segment, which focuses on traditional internal combustion vehicles, posted a 3% revenue decline, with US$661 million in EBIT, down from US$1.17 billion in 2Q24. Ford’s “Pro” commercial division reported 11% revenue growth, which House described as the company’s “growth engine.” The “Model e” electric division reported a US$1.33 billion loss, widening from US$1.15 billion in the previous year.

Other automakers have also revised their full-year 2025 guidance to account for the financial impact of tariffs. Stellantis reinstated its full-year outlook despite reporting a €2.3 billion (US$2.65 billion) net loss in the first half of 2025, compared to a €5.6 billion profit in the same period last year. The company now projects a full-year tariff impact of €1.5 billion, with €300 million already incurred in the first half. CEO Antonio Filosa, who assumed leadership in June, said the company is engaging with the Trump administration to ensure the US content in its vehicles is fairly recognized under current trade policies. 

General Motors reported a US$1.1 billion tariff-related cost in the second quarter of 2025 and expects the full-year impact to reach between US$4 billion and US$5 billion. Chief Financial Officer Paul Jacobson said the company is implementing manufacturing adjustments, targeted cost initiatives, and consistent pricing strategies to offset the added expenses. He noted that GM anticipates its overall tariff burden will decline over time as new bilateral trade agreements take shape and as the company modifies its sourcing and production strategies.