Ford to hold off on raising prices, says CEO Jim Farley

Rule number one in poker is—never let ‘em see your hand, a move that Ford $F ( ▼ 1.0% ) CEO Jim Farley is leaning into heavily in hopes of putting the automaker in a more suitable position to play out the tariffs.

The details: According to a Wednesday Bloomberg report, the top Ford exec. charged with steering the company through the looming uncertainty of the levies has decided against raising prices on vehicles rolling off the assembly line in May. Farley now plans to wait it out—and shared a few details on what he’ll be considering before laying his cards on the table.

• 50% of the vehicles and parts in the industry in the U.S. are imported and will incur $5,000 to $10,000 in additional costs due to tariffs, the Ford CEO told reporters at the company’s pickup truck plant in Kentucky on Wednesday.

• The question is: Will they simply absorb those costs or pass them on to customers—given how pricing decisions are so important from a competitive standpoint, he said. 

What’s Ford’s next move? Assessing how much the tariffs will tack on to the company’s costs when it reports its first-quarter earnings on May 5. The CEO—who stopped short of telling CNN’s Erin Burnett during a Wednesday interview that the automaker won’t raise prices in the summer—also announced that Ford will extend its “From America, For America” employee pricing campaign through July 4. 

Between the lines: Zeroing in a little deeper into Farley’s interview with Burnett suggests that the Ford chief feels relatively comfortable—(well, as comfortable as any auto CEO selling cars in the U.S. could be right now)—with the company’s ability to successfully maneuver the tariffs.  

• “I think we’re in the first or second inning of a nine-inning game, but so far for us in auto, the revenue has been pretty strong.” 

• “We know exactly what the tariff bills will look like for the company. We know the offsets.”

• “We’re the most American company, so if there’s any company that can manage through these tariffs, it’s Ford. We make 80% here.”

Sounds like Ford is holding a pretty solid hand. In fact, it leads one to believe that Farley might be sitting on a Royal Flush in this whirlwind of tariffs, something that Cox Automotive Executive analyst, Erin Keating, likened to wild game of Texas Hold ‘Em. Or is it more a matter of Farley not really knowing how Ford’s hand will play out, but determined not to let anyone see him sweat.   

Bottom line: Ford’s first-quarter earnings report will tell a lot about where the company stands amid all the uncertainty surrounding the industry. However, Ford dealers and shareholders feel a bit at ease—today—by Farley’s confidence about it all. 

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