Joe Hinrichs, Ford Motor Co.’s president of automotive, on Thursday said he’s confident lawmakers can come to an agreement to avoid tariffs that President Donald Trump has threatened to slap on imports from Mexico.
Speaking at the UBS Global Industrials and Transportation Conference in New York, Hinrichs said Ford is in a better position than some of its rivals, but that Trump’s proposed actions could harm the industry.
“It’s not a secret that some of our competitors produce more in Mexico than we do and import more to the U.S. from Mexico than we do, so on a relative basis we’re probably not as exposed as some others,” Hinrichs said. “That being said, if we were to see 5 percent and rising tariffs coming from both auto parts and vehicles from Mexico, it would have a significant impact on the industry, ourselves included.”
The president has threatened to keep raising duties on Mexican imports until the government stops undocumented immigrants from crossing into the U.S. The tariffs would start at 5 percent on Monday, June 10, and rise to 25 percent by the end of the year.
Ford makes the Fiesta, Fusion and Lincoln MKZ sedans in Mexico, although it will discontinue the Fiesta later this year and plans to end Fusion production in the next few years. The automaker also builds engines and transmissions there.
Sen. Chuck Grassley, R-Iowa, who chairs the Senate Finance Committee, on Wednesday predicted that the two sides would strike a deal to avert the tariffs. Hinrichs agreed.
“I’m optimistic that what we’re seeing already is good cooperation from the Mexican government and the U.S. government, and people will work together to find a solution that isn’t harmful to the U.S. economy and certainly the auto industry specifically,” Hinrichs said. “I’d be surprised if this went on for a long period of time.”