At a recent press event in Romulus, Michigan, Jim Farley, CEO of Ford Motor Co., was in high spirits. He gave a thumbs-up as he revealed a new partnership with China’s Amperex Technology. Together, they’ll be building a state-of-the-art factory for electric vehicle batteries in Marshall, Michigan. This announcement marks a significant step forward for the company.
In the automotive world, especially in Detroit, things are buzzing. In a statement on Wednesday, Farley addressed potential tariffs under the Trump administration. He emphasized the importance of considering every country when enforcing tariffs in this industry, not just picking and choosing. This is a crucial point for many automakers.
Farley didn’t hold back, pointing out the significant numbers of vehicles imported every year from Toyota and Hyundai’s plants in Japan and South Korea, respectively. These imports currently enjoy minimal to zero tariffs, a stark contrast to the potential 25% tariffs President Trump has proposed on Canadian and Mexican imports.
During a recent fourth-quarter earnings call with investors, Farley laid it out in plain terms: “Look, if we’re going to have a tariff policy, it has to cover the whole industry. We can’t just play favorites because that’d give our foreign competitors an unfair advantage.”
These comments from Farley came on the heels of Trump imposing an additional 10% tariff on Chinese goods, including automobiles, while also negotiating 25% tariffs on Canadian and Mexican imports.
Despite the challenges, Ford has long emphasized its American investments, proudly claiming it employs more U.S. workers than any other car manufacturer. While this may sometimes work against them economically, the company remains committed to its roots.
According to data from GlobalData, 46.6% of vehicles sold in the U.S. last year were made abroad. Mexico leads with 16.2%, followed by South Korea and Japan with 8.6% and 8.2%, respectively. Cars from South Korea face no tariffs, whereas those from Japan incur just a 2.5% duty fee—except for trucks, where both countries face a 25% tariff.
Moreover, alongside Hyundai and its affiliate Kia, General Motors imports countless vehicles from South Korea, all without paying tariffs. Japanese automakers like Nissan and Honda, plus others like Subaru, continue to import vehicles from Japan, much like Toyota does.
In short, Farley’s comments shed light on the broader complexities of the global automotive market and underline the need for a well-thought-out and fair approach to tariffs. As the auto industry continues to evolve, these discussions will undoubtedly shape its future.
