Ford Motor has hiked prices on three of its Mexico-produced models effective May 2, becoming one of the first major automakers to adjust sticker prices following U.S. President Donald Trump's tariffs.
Prices on the Mustang Mach-E electric SUV, Maverick pickup and Bronco Sport will increase by as much as $2,000 on some models, according to a notice sent to dealers, which was reviewed by Reuters.
Ford earlier this week said Trump's trade war would add about $2.5 billion in costs for 2025, but it expects to reduce that exposure by around $1 billion. Rival General Motors said last week that tariffs were projected to cost it between $4 billion and $5 billion following the imposition of hefty levies on foreign imports of automobiles, but it expected to offset that by at least 30%.
A Ford spokesperson said the price hikes will affect vehicles built after May 2, which would arrive at dealer lots in late June. The spokesperson said the price hikes reflect "usual" mid-year pricing actions, "combined with some tariffs we are facing. We have not passed on the full cost of tariffs to our customers."
Ford shares were down 1.7% at $10.26 at midday. The automaker is still running a discount program through the July 4 weekend on many of its models, the spokesperson said.
Trump's tariffs have unleashed weeks of uncertainty across the auto sector, as major carmakers in the United States and Europe have pulled forecasts, shifted production and caused companies to idle plants.
Following weeks of pushback from the auto industry, Trump softened his tariffs on foreign auto parts imports to give carmakers credits for what is produced in the U.S. and to avoid double-tariffs on raw materials used in auto production. However, the White House has not rescinded a 25% tariff on the 8 million vehicles the U.S. imports annually.
Analysts have said U.S. auto sales could drop by more than 1 million vehicles a year if tariffs were to remain in place.
Ford is in a better position to weather tariffs than some of its competitors because of its strong U.S. manufacturing base. The Dearborn, Michigan, automaker assembles 79% of its U.S.-sold vehicles domestically, compared with GM's 53%, Barclays analysts said in a note.
Still, Ford imports one of its most affordable and popular vehicles, the Maverick, from Mexico. Most major U.S. automakers face significant price hikes on their cheaper models produced in the country.
Ford and GM also face significant levies on imports from China and South Korea, respectively. GM estimated that the costs on its Korean imports totaled about $2 billion, while Ford declined to specify the expenses around importing vehicles from China.
Automakers that rely on exports to the United States are facing increased pricing pressure. A dozen major automakers including Toyota and GM import at least 40% of the vehicles they sell in the U.S., with some such as Volkswagen and Hyundai Motor importing more than 60%, according to 2024 data from S&P Global Mobility.
Before Ford's move, most automakers had not taken the step of boosting prices, but had warned that was on the way.
Porsche said it would have to boost its selling cost if tariffs remained in place while U.S. Volkswagen's Audi brand also suggested potential price increases, without providing any details.
By contrast, BMW expects U.S. car tariffs to decline from July, based on its contacts with U.S. officials - a more upbeat assessment of the trade climate than many rivals. GM's finance chief, Paul Jacobson, told analysts last week that the automaker was not expecting imminent price increases, saying they "feel good about where the pricing environment is today."
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