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Jim Hackett says metal tariffs costing Ford $1 billion in profits

Ford CEO Jim Hackett divulged in an interview with Bloomberg that the Trump administration's tariffs on metals imported from the European Union, Canada and Mexico have affected the automaker's balance sheet, adding that trade disputes need a quick resolution. "From Ford's perspective, the metals tariffs took about $1 billion in profit from us," Hackett told the outlet. "The irony is we source most of that in the U.S. today anyways. We're in a good place right now, but if it goes on longer there will be more damage." Hackett did not specify what period the $1 billion covered, but a Ford spokesman said the CEO was referring to internal forecasts at Ford for higher tariff-related costs in 2018 and 2019. President Trump in March announced his intention to enact 25 percent tariffs on steel imports and 10 percent on imported aluminum from the three trade zones as a way to protect the U.S. steel industry. The move sent U.S. automakers' stock prices plunging at a time when they were coming off weak monthly sales reports. Separately, President Trump has targeted China with two rounds of tariffs targeting a combined $260 billion worth of imports. China has responded by enacting 25-percent tariffs on U.S. goods including vehicle imports. In the interview, Hackett said that has hurt demand for Lincoln, which has found a growing market for its luxury vehicles in China, and made the price of the Lincoln MKC less attractive to Chinese buyers. The MKC is built at the company's Louisville, Ky. assembly plant. "We've had to move people in that factory to other operations because of that trade problem," he said. It's not clear what those moves entail or how many workers were involved. Autoblog sought comment from a Ford spokeswoman and will update this story if we hear back. Ford last month announced it was scrapping plans to import the Focus Active small crossover to the U.S. from China because of the new 25-percent tariffs on Chinese imports. Material from Reuters was used in this report Related Video:

Ford CEO Jim Hackett reviewing the future of technology, Lincoln, overseas markets

By Paul Lienert and Joseph White Ford Chief Executive Jim Hackett is reviewing the automaker's operations in India and other markets, as well as Ford's future product programs including plans to build a self-driving commercial vehicle in 2021. Hackett, who took over as CEO in May, has told investors he is working on a 100-day review of Ford's operations but has so far provided few details of the process, except to indicate that it is looking at the automakers' luxury vehicle strategy, the future of its small vehicles and investments in emerging markets. Ford Chief Financial Officer Bob Shanks told Reuters in an interview that the review covers a range of issues, including Ford's strategy for India. "We have a lot of work to do (as) we address issues of how to fix India," Shanks said. "Everything is on the table." General Motors in May said it would stop selling cars in India but continue to produce vehicles there for export. Shanks said no decisions have been made and noted that Ford has a larger business in India than GM did. "We are very cognizant that will be the third-largest market in the world," he said. "Some big decisions will be made," Shanks said, but he cautioned Ford may not disclose all those decisions at the end of the 100-day review. Hackett is addressing challenges that have contributed to a nearly 8 percent decline in Ford's share price this year. The review of the Lincoln luxury brand includes whether current plans will meet former CEO Mark Fields' ambitious targets for growth and revenue, people familiar with the process said. Ford has set a target of putting a self-driving shuttle into commercial ride-sharing fleets by 2021. Hackett is reviewing the investment and timing for that project, the sources said. Hackett also assessing whether to reduce and consolidate production of models such as the Fiesta subcompact and two midsized sedans that are built in multiple locations around the world, but are experiencing slowing demand. One proposal would shift production of the next-generation Mondeo midsized sedan from Europe to Mexico, where it would share an assembly line with its sibling, the Ford Fusion, avoiding the cost of retooling two plants. Shortly after he took charge, Hackett approved a proposal to shift production of the next-generation Focus for North America from Mexico to China, saving the company an estimated $500 million by consolidating two factories into one.

Lincoln confirms the MKZ only has a few months left to live

Lincoln confirmed it will put the MKZ out to pasture in 2020. The sedan is based on the Ford Fusion, which is also scheduled to retire in the coming months as the company pivots towards high-riding models. Introduced at the 2012 New York Auto Show, the MKZ is the oldest member of the Lincoln portfolio by a wide margin, so its demise hardly comes as a surprise. The firm quietly broke the news as it announced plans to release an electric SUV built using technology borrowed from Rivian. The 2020 model is already out, and Lincoln tells Autoblog production will end in mid-2020, with sales continuing through the rest of the year. There will be no 2021 model.   Though never a home run, the MKZ will be remembered as a significant car because it ushered in the design language that characterizes every model Lincoln sells in 2020 when it received a mid-cycle update for the 2017 model year. And, with up to 400 horsepower on tap, it also stood out as the most powerful production Lincoln ever released. Power and an elegant design weren't enough to give the nameplate a significant boost, and annual sales dropped to 17,725 units in 2019 from a peak of 34,009 cars in 2014. Even the Navigator outsold it. In recent years, the MKZ perplexingly became the autonomous car world's darling. Faraday Future, Didi Chuxing, Aurora, and Qualcomm are among the companies that tested their technology with MKZ-based prototypes. Lincoln explained the Hermosillo, Mexico, factory that makes the MKZ and the Fusion will "prepare for production of new Ford vehicles," but it didn't specify which ones. There's absolutely no evidence the company is developing a direct replacement for its entry-level sedan, so the Continental will carry the torch on its own. Its days might be numbered, too, because several unverified reports claim Lincoln will again consign the nameplate to the attic in the coming years to free up the production capacity it needs to build electric cars in Flat Rock, Michigan. Once it goes, Lincoln's range will be entirely sedan-free for the first time since the company was created in 1917. Some automakers still believe in the sedan, like Audi, but Lincoln seems to be a student of Ford's philosophy. Related Video: