Citing Trump’s tariffs, on August 31, Ford Motors announced that it’s abandoning plans to sell the Focus Active — which the company makes in China — in the United States. The Focus Active, a small crossover, was one of two models Ford planned to sell in the U.S. as it shifts its lineup to be almost exclusively SUVs and trucks.
But in one of his early morning Tweets Sunday, Trump tweeted: “Ford has abruptly killed a plan to sell a Chinese-made small vehicle in the U.S. because of the prospect of higher U.S. Tariffs. . . . This car can now be BUILT IN THE U.S.A. and Ford will pay no tariffs!”
But as Ford explained in their announcement on August 31, Trump’s decision in July to slap an additional 25 percent tariff on vehicles made in China and imported into the United States undermined the profitability of the Focus Active. The move will actually make little difference on Ford’s profits because the company was expecting to sell fewer than 50,000 of the vehicles in the U.S, anyway.
Kristin Dziczek of the Center for Automotive Research said that Ford can make Focuses “in many other plants around the world, so if they decided to continue to sell a Focus variant in the U.S. market, there are several options other than building it in the United States.”
“This is further evidence that neither the president nor his trade representatives have any clue of the complexities of global supply chains,” Jon Gabrielsen, a market economist who specializes in the auto industry, told the Detroit Free Press on Sunday.
Trump must have not been paying attention when in April this year, Digital Journal reported that Ford announced plans to stop making cars in the United States — except for the iconic Mustang — and to focus on more profitable SUVs.
At that time, Ford also reaffirmed its commitment to bring hybrid-electric powertrains to the F-150, Mustang, Explorer, Escape and the upcoming Bronco. Ford plans to shift $7.0 billion in investment capital from its car business over to SUVs, estimating that SUVs could make up as much as half of the industry’s U.S. market by 2020.
