Ford’s Earnings Hit by Tariffs
Ford Motor Company (NYSE: F) anticipates an earnings decline of $1.5 billion this year due to tariffs imposed by the Trump administration, especially as 17% of its North American production is based in Mexico and Canada. The company has withdrawn its full-year earnings and revenue guidance due to ongoing tariff-related uncertainty.
Investor Concerns and Market Performance
Despite a current dividend yield above 6% and shares trading at a price-to-earnings multiple of 10, Ford’s stock has underperformed, decreasing by 17% over the past decade compared to the S&P 500’s growth of over 200%. The company is facing challenges in the electric vehicle segment, having reported a loss of $849 million in Q1, with uncertainty surrounding federal EV incentives and infrastructure funding.
Consumer Sentiment and Incentive Programs
As consumer confidence wavers, Ford has recently introduced an employee pricing incentive and a “0-0-0” summer sale program to attract hesitant buyers amidst economic jitters. With recession odds estimated at 40%, potential car buyers are still cautious about major purchases.
