The United States auto giant Ford revised its full-year outlook after reporting stronger-than-expected second-quarter revenue. The company now includes an estimated $2 billion in losses from tariffs. Ford officials emphasized that these costs continue to challenge the company’s global operations.
Previously, Ford expected a $2.5 billion hit from tariffs. However, it planned to offset $1 billion through internal savings. With new projections, total losses from tariffs have increased to $3 billion. Despite this rise, the company still aims to limit the net impact to $2 billion.
Tariff pressure remains high as Ford navigates steel and aluminum price increases. Chief Financial Officer Sherry House said the company holds regular talks with the administration. These discussions mainly focus on manufacturing costs and material pricing.
Ford raised retail vehicle prices by around 1 percent to counter rising expenses. Executives expect this increase to stay consistent through the year. While this helped earnings, the company also faced special charges related to vehicle recalls.
The updated forecast now targets $6.5 billion to $7.5 billion in adjusted earnings before interest and taxes. This range is lower than earlier projections of $7 billion to $8.5 billion. Adjusted free cash flow remains steady at $3.5 billion to $4.5 billion.
Capital expenditures are expected to hit $9 billion, up from the earlier midpoint. CEO Jim Farley highlighted Ford’s commitment to US-based manufacturing. He noted that 80 percent of Ford vehicles are made in America.
Still, the company imports many parts from international suppliers. Farley said Ford will continue to work with the administration to ease tariff pressure. Some relief has come from recent trade policy revisions, though executives seek further support.
Ford’s second-quarter revenue reached $50.2 billion, a 5 percent increase from last year. Automotive revenue also surpassed expectations, hitting $46.9 billion. However, operating profit fell to $2.14 billion, compared to $2.76 billion the year before.
The automaker posted a net loss of $36 million due to recall-related charges and an EV program cancellation. A recent recall of over 694,000 SUVs cost the company $570 million. Leaders expressed dissatisfaction with current recall levels.
Ford’s commercial segment saw 11 percent growth and was described as the company’s “growth engine.” Meanwhile, its electric vehicle business lost $1.33 billion. Sales of pure EVs dropped sharply, though hybrid sales jumped by 23.5 percent.
Executives said they are adjusting their EV strategy amid regulatory changes. New policies could end EV tax credits and roll back emissions standards. Despite setbacks, Ford sold over 612,000 vehicles during the quarter, up 14.2 percent from last year.
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