Ford CEO Farley on Supplier Fire, Tariff Impact and EVs

Well, we're still working through it, Matt. Hi. Thanks for having me on the show. We're still working through it. It'll be, I'd say, around 100,000 units, but we still have the opportunity to improve that. This is really a retiming of wholesale. What we lose this year, we'll gain most of it back next year. Maybe a billion and a half to two and a half billion of effort this year, a little bit heavier on the cash because of how auto works, but we'll be gaining at least a billion, if not more, of that back next year. So it's kind of a retiming. Very serious situation, but really proud of how the team dealt with it so far.

Yes, there was. And I have to thank Donald Trump, our president, and the administration. This is a huge benefit for America's largest auto producer. It did cut our tariffs to about $1 billion. It will be about the same next year. This is basically a reduction of our imported parts that we have to import for our U.S.-produced vehicles, finished vehicles. But they also announced a 25% tariff on imported heavy and medium duty trucks, which is a big benefit for Ford because we make 100% of our Super Duties, our most profitable vehicle, in the US. We do not import them, but our competitors do. So a lot of things are going on in the policy area, including the upcoming EPA decision on tailpipe emissions.

Really good question. So Ford produces 80% of what we sell in the U.S. here in the U.S. We actually export more, so it's more like 85%. We are way ahead of our competitors, even our domestic competitors. Some of them are only importing or making about 50% in this country. So the administration, Donald Trump himself, really listened carefully to Ford as we made our way through adjusting these new tariffs. And that was a proclamation we saw last week where we would moderate our tariff. We still have a tariff net, but this is a much more reasonable level and certainly rewards us as the most American car company. And you can see our tariff has been cut in half basically. Now we still have more work to do, but we're very thankful to the administration for the adjustments they made as we made our way through all this after the bilateral trade agreements with Japan, for example.

The number one thing on dealers' minds and consumers' minds, of course, is affordability. We make America's best-selling vehicle, the F-150, for 47 years now, and that's what's on the mind of everyone now in the U.S. We're starting to see payments go out another full year to seven or eight year financing. It's not in Ford's captive, but some of the third-party finance companies are starting to see more stress on repossessions. That's not the case at Ford. We tend to have the highest-end customers because of our prices, but that's on everyone's mind right now and a key focus for us. In fact, our fastest-turning vehicle is a Ford Maverick, an affordable hybrid pickup truck, because it's affordable.