Chris Neiger, The Motley Fool

Thu, May 22, 2025, 3:20 AM4 min read

• Automakers are facing an uncertain future.

• Ford is already feeling the pinch from tariffs, and further economic uncertainty could slow the company down.

• Ford isn't a millionaire maker and it's probably best to avoid the stock right now.

• 10 stocks we like better than Ford Motor Company ›

There's been a resurgence of investor interest in automakers recently, after President Trump indicated that some automotive tariffs may not be as bad as initially feared. Ford (NYSE: F) stock plummeted in early April on the initial tariff rollout but has since rebounded and is up nearly 9% year to date.

But investors may want to temper their enthusiasm. Ford continues to face significant headwinds on multiple fronts. Here's why Ford stock isn't a millionaire maker and why it's probably best to avoid it right now.

The Trump administration said recently that it wouldn't "stack" automotive tariffs on top of each other. For example, a steel tariff wouldn't be applied to imported auto parts that have already undergone a tariff. Moreover, the administration said automakers could receive a rebate on some tariffs for the first two years.

But the damage has already been done to Ford and its peers. The company pulled its full-year guidance for 2025 and said tariffs will cost $1.5 billion this year, even after attempts to offset some of the impact.

To understand just how much the tariff turmoil is hurting Ford, consider that the company's previous guidance was for about $8 billion in earnings before income and taxes (EBIT) for the full year. Yet the company had just $1 billion in EBIT earnings for its first quarter, far below the pace required to meet that goal, which was set just three months ago.

Ford CEO Jim Farley said on the company's earnings call that, "it's still too early to fully understand our competitors' responses to these tariffs. It's also early to gauge the related market dynamics, including the potential industrywide supply chain disruptions and the impact of Ford's domestic manufacturing advantages."

While tariff deals are being worked out, some damage has clearly already been done to Ford and its peers. And there could be more pain on the way.

Another result of a chaotic tariff rollout is that consumers are now more worried about the economy. A recent University of Michigan survey found that consumer sentiment is at its lowest point in three years, and Americans are expecting inflation to start ticking up later this year.