Tariffs Already Have an Effect on Ford

A few months ago, Ford announced that it would no longer create passenger cars for the US market and now the tariffs are having a negative impact as well.

In the US, we don’t have the benefit of driving some of the models offered in other countries. This has been the case for many years as government regulations have kept models off our roads that were felt to be too powerful, offer too much pollution, or lack a level of safety that’s expected on our roads. Most of the time, this hasn’t been a real problem and consumers understand the need to make certain cars are right for the market, but now, the newly announced tariff amounts are going to keep one of our domestic names from offering a new model to our market.

The Ford Change has Changed Again

The movement toward smaller crossovers has made it evident that today’s consumer wants to ride higher and have more capabilities than what a sedan or small hatchback can offer. In order to “trim the fat” from the costs of doing business, Ford decided to only allow a new Ford Focus to be offered which is called the Focus Active which is a model that rides a bit higher and is a small crossover with a sedan name.

We’re Not Getting the Ford Focus Active

The proposed tariffs that will be imposed by the government for vehicles that aren’t made in the US will make it too costly for Ford to bring the Focus Active to the US. This is a car that’s built in Europe and China and importing this vehicle no longer makes financial sense for Ford because of the imposed trade tariffs with China. This means the future of Ford for our market is going to be the Mustang and a lineup of crossover SUVs before reaching the F-150.

The Tariff Will Affect Other Brands as Well

As the US brand names have begun to make more of a showing in the Chinese market, the movement to build vehicles in China that are imported to the US has grown. The Focus Active may be the Ford model we won’t see in the future, but there’s also another model that might be affected which we already have on the market. The Buick Envision is the middle of the Buick crossover lineup and it’s built in China as well. Does this new tariff mean GM will stop bringing the Envision to the US market for the future?

The Tariff Needs to Be Gone

When an import/export tariff affects brands that are considered to be domestic names, it needs to be gone. This new tariff for vehicles that are imported from other countries is likely to have a greater negative effect on the domestic market than on foreign ones. The automotive world is global and most automakers have plants in locations where they sell the vehicles that are built. Only a few models are actually imported in today’s automotive world and you can see examples of the effects with the Ford Focus Active that’s now been canceled for our market.