Legacy automaker Ford Motor (F) might soon charge more for its cars, with new auto tariffs putting pressure on the sticker. A memo shared with dealers reveals that if President Donald Trump’s 25% auto tariffs stick around, the company may hike prices on new vehicles starting in May, according to Reuters.
Currently, Ford is still offering major discounts across its lineup through June 2, with no hikes on cars already sitting at Ford and Lincoln lots. But after that, price tags could start climbing fast.
Tariffs’ Impact on Production and Pricing
The 25% auto tariffs, which kicked in on April 3, have disrupted the integrated North American auto supply chain. Though Ford builds about 80% of its cars in the U.S., it still brings in a lot of parts from outside the country. With the new tariffs in place, the added cost per vehicle could be as much as $2,100. That could be a serious dent, not just in Ford’s profits, but also for the consumer’s wallet.
Ford executive Andrew Frick said in the memo that, “in the absence of material changes to the tariff policy as articulated to date,” the company expects to raise vehicle prices, likely starting with models produced in May.
Farley’s Big Warning
Ford CEO Jim Farley isn’t staying quiet. He’s calling the tariffs a major threat, saying they could “blow a hole” in the U.S. auto industry. He believes it could potentially wipe out billions in profits, leading to higher prices for consumers.
He’s not alone. Other automakers, such as General Motors (GM) and Stellantis (STLA), are also sounding the alarm, warning that these tariffs could push prices up by as much as 25%.
Tariff Relief on the Table, But Uncertain
Earlier this week, Trump suggested the possibility of exemptions from the upcoming 25% tariffs on auto parts, hinting at temporary relief. The move could give automakers more time to adjust, especially those relying on parts from Canada, Mexico, and other USMCA trade partners.
Still, no final decision has been made. Automakers are preparing for potential changes as the uncertainty persists, and shoppers may wish to finalize their purchase before prices escalate.
Is Ford Stock a Good Buy Right Now?
Turning to Wall Street, analysts have a Hold consensus rating on F stock based on three Buys, nine Holds and three Sells assigned in the past three months, as indicated by the graphic below. After a 16% loss in its share price over the past year, the average F price target of $9.46 per share implies 0.64% upside potential.
