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Ford CEO Says Metals Tariffs Took $1 Billion of Profit

Sept. 26, 2018
CEO Jim Hackett urged the Trump administration to resolve trade disputes quickly, or they could do "more damage" to his company.

Ford Motor Co. (IW 500/3) Chief Executive Officer Jim Hackett encouraged the Trump administration to resolve trade disputes quickly or it could do “more damage” to his company, which is already suffering losses from tariffs imposed by President Donald Trump.

“The metals tariffs took about $1 billion in profit from us -- and the irony is we source most of that in the U.S. today anyways,” Hackett said in an interview on Bloomberg Television. “If it goes on longer, there will be more damage.”

Ford and other global automakers have opposed the president’s use of tariffs and the retaliation they spur. Last month, Jim Farley, Ford’s president of global markets, described Trump’s tariffs on steel and aluminum as a “significant headwind for us.” A few weeks later, the second-largest U.S. automaker canceled plans to import the Focus Active crossover from China, citing Trump’s vehicle tariffs.

“What we’re urging our administration to do -- where we’re in China and in Europe -- we say, you need to come to agreement quickly,” Hackett said.

Ford reported net income in 2017 of $7.6 billion, the most since 2013, but with analysts estimating a 29% drop in profit this year, it’s embarked on an $11 billion restructuring effort to improve margins in the core automotive business while investing billions in electric and autonomous-vehicle technology.

Ford shares were little changed at $9.41 at 8:39 a.m. before regular trading. They have tumbled 25% this year.

By Keith Naughton

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Licensed content from Bloomberg, copyright 2016.

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