Ford reported its Q2 2025 earnings on Wednesday, surpassing both top and bottom line expectations. However, the company is cautioning investors about potential profit declines due to the impact of Trump’s tariffs on the auto industry. Despite the revenue growth, Ford is bracing for a $2.5 billion hit from the tariffs.
Unlike some of its competitors, Ford builds a significant portion of its vehicles in the US, which means it may face a lesser impact from the 25% tariff on imports. Approximately 21% of the vehicles Ford sells in the US are imported, compared to around 46% for its crosstown rival, GM. GM recently reported that the tariffs cost them an additional $1.1 billion in the second quarter alone.
Ford divides its earnings into three units, including its electric vehicle business, Model e. Although Ford saw a 14% increase in vehicle sales in Q2, its EV sales dropped by 31% to just 16,438 units. This decline was attributed to the transition to the 2025 model year and a recall affecting the Mustang Mach-E and F-150 Lightning.
Wall Street analysts are expecting Ford to post second-quarter earnings per share of $0.33 on revenue of $43.75 billion. However, Ford exceeded these expectations by reporting revenue of $50.02 billion and an adjusted EPS of $0.37.
Despite the strong revenue figures, Ford posted a net loss of $36 million in the quarter. This loss was primarily due to expenses related to a field service action and the cancellation of an electric vehicle program. Additionally, the company incurred an $800 million loss as a result of tariffs.
Ford’s Model e EV business reported a loss of $1.3 billion in the second quarter, bringing its total losses for the first half of the year to $2.2 billion. These losses were attributed to tariff-related costs and investments in launching a new EV battery plant in Michigan.
Ford is optimistic about its future prospects, with plans to design and build breakthrough electric vehicles in America. The company’s CEO, Jim Farley, announced an event on August 11 in Kentucky where Ford will provide more details about its EV plans. Ford aims to focus on trucks and SUVs in the EV space and will utilize LFP batteries manufactured in Michigan to reduce costs.
The first electric model built on Ford’s new platform is expected to be a mid-size pickup truck, scheduled to be released in 2027. Ford anticipates full-year adjusted EBIT of $6.5 billion to $7.5 billion, factoring in a $2 billion impact from tariffs. Despite these challenges, Ford remains committed to its electrification goals and is determined to stay competitive in the evolving automotive industry landscape.
