Ford’s caught in the middle of a messy trade war, and a leaked internal memo shows they might have to take drastic steps to stay competitive, through a price hike.
The Ford tariff memo hints that the company could hike prices on new cars built in May if U.S. tariff policy doesn’t change soon. Despite offering big discounts through June 2, Ford is preparing for the worst as the White House sends mixed signals about its stance on import duties.
The 25% tariff plan proposed by President Trump has already rattled the auto industry. According to the Wall Street Journal, Trump personally told top auto CEOs not to raise prices in response to the tariffs. But in true Trump fashion, days later he told NBC News he didn’t care if automakers hiked prices – and even denied ever delivering that warning.
Caught in this chaotic policy storm, Ford is keeping its options open. In the memo reported by Reuters, Ford exec Andrew Frick says they’re likely going to need “vehicle pricing adjustments” by May production unless something changes fast. That could mean higher sticker prices on new models for buyers – and more uncertainty for dealers.
Trump recently suggested he might exempt automakers temporarily, admitting they’ll “need a little time” to bring production back to the U.S. But no one knows how long that grace period might last – or if it’ll even happen. So Ford, which already builds 80% of its vehicles in the U.S., may still get hit by tariffs on imported parts and specialty models.
Meanwhile, Japan’s carmakers are bracing for impact. A U.N. report says Japan could lose $17 billion in U.S. auto exports if the new tariffs fully kick in. Mazda, for instance, builds some cars in Alabama but still imports most of its U.S.-sold vehicles from Japan and Mexico. Mitsubishi is going even further – literally pausing deliveries by keeping its vehicles in port to avoid the new duties. They say there’s still enough stock at dealerships to keep customers happy… for now.
Mitsubishi’s U.S. sales were up nearly 26% in 2024, the best since 2019. So even while they’re playing defense, they’re not slowing down. But with uncertainty growing and Trump’s policies constantly shifting, automakers big and small are scrambling to build backup plans.
What do you think – should Ford hold the price or pass the cost onto buyers through a hike?
