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Ford CEO Jim Farley is warning President Donald Trump that his proposed 25 percent tariffs on Mexico and Canada are going to cause absolute havoc with the American auto industry.
As reported by Wards Auto, Farley told a Wolfe Research investment conference this week that the auto industry so far has only seen "a lot of cost and a lot of chaos" from Trump in his second term, including not just his big proposed tariffs on America's two largest trading partners but also the tariffs he's already enacted on foreign steel and aluminum.
He also said that a prolonged trade war throughout the entire North American continent would cause incalculable damage.
"There’s no question that tariffs at a 25 percent level from Canada and Mexico, if they’re protracted, would have a huge impact on our industry, with billions of dollars of industry profits wiped out and an adverse effect on the U.S. jobs," he said. "Let's be real honest: Long term, a 25% tariff across the Mexico and Canada borders would blow a hole in the U.S. industry that we've never seen."
He also said it would paradoxically be a win for the foreign auto companies that Trump has also vowed to target.
"Frankly, it gives free rein to South Korean, Japanese and European companies that are bringing 1.5 million to 2 million vehicles into the U.S. that wouldn't be subject to those Mexican and Canadian tariffs," he said. "It would be one of the biggest windfalls for those companies ever."
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