Ford lifts outlook on tariff refund, flags aluminium cost pressures

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Ford Motor Company has raised its full-year earnings outlook by USD 500 million, supported by a sizeable tariff refund, even as rising aluminium costs and supply disruptions weigh on its operations, particularly for its flagship F-150 pickup.

The automaker said a February ruling by the US Supreme Court, which struck down parts of the Trump-era tariffs, is expected to deliver USD 1.3 billion in relief. Ford recognised a paper gain from this anticipated refund in the first quarter, boosting earnings, though it cautioned that the timing of reimbursement remains uncertain.

Despite the windfall, Ford’s upgraded guidance falls short of the total refund value, reflecting mounting cost pressures. The company now expects higher tariff-related expenses through the year, alongside elevated input costs for key materials such as aluminium. These pressures have been exacerbated by supply disruptions at Novelis, Ford’s major US aluminium supplier, following two significant fires in 2025.

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Production at the affected Novelis facility in New York is scheduled to restart between May and September, with the supplier indicating output could resume by late second quarter. Until then, constrained aluminium supply is expected to continue impacting Ford’s manufacturing operations.

Ford now projects annual earnings before interest and taxes (EBIT) in the range of USD 8.5 billion to USD 10.5 billion, up from its earlier forecast of USD 8 billion to USD 10 billion. The company also estimated net tariff costs of USD 1 billion for the year, but did not disclose the gross impact. Shares edged down by less than 1 per cent in after-market trading following the announcement.

For the first quarter, Ford reported adjusted earnings per share of 66 cents, significantly above analyst expectations of 19 cents. Adjusted EBIT stood at USD 3.5 billion, while revenue reached USD 43.3 billion. Net profit for the quarter was USD 2.5 billion.

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However, operational challenges remain visible. Inventory levels of the F-150 dropped 38 per cent year-on-year in April, according to Catalyst IQ data, largely due to the aluminium supply disruption linked to the Novelis fires. The F-150, America’s best-selling vehicle for over four decades, remains central to Ford’s profitability, making any production setback a critical concern.

F-Series production is estimated to have declined 12 per cent year-on-year in the first quarter as of mid-April, a sharper drop than previously anticipated. “Ford may be having a more difficult time recovering from the Novelis fire than was earlier expected,” said JPMorgan analyst Ryan Brinkman.

Overall vehicle sales fell 9 per cent in the quarter, with weaker demand for electric and hybrid models contributing to nearly half of the decline.

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In contrast, rival General Motors reported a 22 per cent rise in quarterly core profit. They raised their annual forecast, aided by a robust US market and an expected USD 500 million tariff refund. Over the past year, Ford’s shares have gained about 20 per cent, trailing General Motors’ more than 60 per cent rise.