Ford reports Q2 net loss and predicts bigger impact from tariffs ahead

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Ford Motor Co. reported record revenue in the second quarter of $50.2 billion as its employee pricing program helped drive sales and its commercial fleet arm, Ford Pro, delivered strong profit margins.

But ultimately, Ford was plagued with special charges including $570 million related to a recall and a similar amouth for canceling an electric vehicle. Both helped the company report a loss of $36 million to its net income. Ford also continues to lose money on EVs. The Ford Model e electric vehicle unit lost $1.3 billion in the quarter, a wider loss than the $1.1 billion it lost in the year-ago period.

The Dearborn-based automaker also reported it had $800 million in costs related to tariffs in the quarter. For the year, Ford expects tariffs to cost it $3 billion, but said it can "recover" $1 billion of that through pricing, production or other actions. That puts its estimated net tariff cost this year at $2 billion, which is slightly higher than Ford's initial $1.5 billion estimate, Ford CFO Sherry House told reporters. The higher estimate is due to tariffs such as those on steel and aluminum.

Earlier this year, President Donald Trump put 25% tariffs — taxes an importer pays for goods at the border — on all imported vehicles and imported auto parts. Ford builds vehicles in Mexico, Canada and China that it sells in the United States. Ford also buys parts from overseas suppliers for the vehicles it builds here.

In May, Ford said prices on the Mustang Mach-E electric SUV, Maverick pickup and Bronco Sport — all built in Mexico — would increase by as much as $2,000 on some models to help cover the added costs of tariffs.

Ford had canceled its full-year guidance at the end of the first quarter due to tariffs and other economic uncertainty. But because Ford has a clearer picture of the year ahead, it reinstated its full-year guidance.

Despite the challenges in the quarter, Ford CEO Jim Farley said Ford is making strides on cost-controls and quality improvements.

"Ford Pro is a unique competitive advantage driving both top and bottom-line growth while creating new high-margin revenue streams from software and physical services," Farley said in a statement. "Ford Blue delivered profitable market share gains, and we continue to improve the efficiency of our Ford Model e business."

Farley noted that Ford has an event on Aug. 11 in Kentucky where leaders will share more on Ford's plans to deliver "breakthrough electric vehicles in America."

Ford reinstates its forecast

In February, Ford provided adjusted earnings before interest and taxes (EBIT) guidance of $7 billion to $8.5 billion for the year. Ford then withdrew that guidance in May due to tariff-related uncertainty.

On July 30, Ford said it now expects its full-year adjusted EBIT to be $6.5 billion to $7.5 billion, which includes a net tariff-related cost of $2 billion. Ford also expects to generate $3.5 billion to $4.5 billion in adjusted free cash flow. It expects to spend $9 billion to maintain and operate the business.

Ford said its updated guidance comes from a strong underlying first-half across all parts of the company and continued improvement in cost.

More: Ford has spent 18 months trying to fix quality problem that’s costing company billions

Ford hedges despite having cash

Ford said it generated $6.3 billion in cash flow from its operations in the second quarter. Still, on the eve of Ford's earnings, Ford said in a government filing that it secured a $3 billion line of credit going forward.

Ford said it finished the quarter with nearly $28 billion in cash and $46 billion in liquidity, a robust sum to help Ford withstand any economic volatility.

House said Ford's actions to secure extra credit going forward will give it a strong cash balance sheet to invest in the company's growth; The tactics do not mean it foresees an economic downtown.

"We do think the U.S. outlook calls for slower growth, but certainly not a recession," House said.

The automaker reported strong new vehicle sales in the quarter of 612,095 new vehicles sold in the United States, a 14.2% increase compared with the year-ago period. Those sales were driven by demand for its SUVs and pickups and helped by Ford's "From America, For America" employee-pricing for all sales program.

Crosstown rival General Motors reported last week that its second-quarter net income declined 35% to $1.89 billion, compared with the prior year’s second quarter of $2.93 billion as increased costs from automotive tariffs cost it $1.1 billion.

Stellantis, which makes Chrysler, Dodge, Jeep, Ram and Fiat brands, reported a $2.6 billion net loss for the first half of 2025, a result the company attributed to tariffs, higher industrial costs and an ongoing effort to revamp the automaker's performance.

On July 30, just hours ahead Ford's second-quarter earnings, the company announced it had hired former GM executive Alicia Boler Davis to be president of Ford Pro. Ford Pro is Ford's commercial fleet business, a highly lucrative arm of the company that has helped lead Ford to profitability. Ford Pro earned more than $9 billion for all of last year, including $1.63 billion in the fourth quarter. 

Here are the numbers Ford reported on July 30:

• Net loss of $36 million, compared with the prior year’s second quarter net income of $1.83 billion.
• Total revenues of $50.2 billion, compared with $47.8 billion in second-quarter 2024. 
• Full-year financial guidance of adjusted earnings before interest and taxes to be $6.5 billion to $7.5 billion, down slightly from earlier guidance this year.
• Sales rose 14% in the second quarter compared with Q2 2024 and 6.6% in 2025’s first half.
• Adjusted earnings before income and taxes (EBIT) of $2.1 billion, down 0.6% from $2.8 billion in the same quarter the prior year. 

Ford’s traditional business operations, known as Ford Blue, earned $661 million in the quarter compared with $1.17 billion in the year-ago quarter. Its Ford Pro commercial business earned $2.3 billion compared with $2.6 billion a year earlier. Its “Model e” electric vehicle unit lost $1.3 billion compared with a loss of $1.1 billion a year earlier.

Ford noted that its results in the Ford Model e unit reflect net tariff-related costs, investments in next-generation EVs and the cost to launch Ford’s new battery plant in Marshall. Ford said the segment doubled revenue to $2.4 billion and EBIT performance for first-generation products, Mustang Mach-E and F-150 Lightning, was essentially flat year-over-year, excluding the impact of tariffs. It said the results underscore gains in operating leverage and cost cuts.

Ford’s stock price ended the quarter on June 30 at $10.85 a share, up from $9.94 at the start of the quarter on April 1.

Jamie L. LaReau is the senior autos writer who covers Ford Motor Co. for the Detroit Free Press. Contact Jamie at jlareau@freepress.com. Follow her on Twitter @jlareauan. To sign up for our autos newsletter. Become a subscriber.