Ford’s Jim Farley presses for lower auto parts tariffs and tougher USMCA enforcement

Ford CEO Jim Farley said the automaker wants the next version of the United States-Mexico-Canada Agreement to make it easier to bring auto parts into the United States without punitive tariff costs, while also tightening enforcement so competitors cannot benefit from non-compliance. Farley made the case in an interview reported by the Detroit Free Press on June 8, describing his priorities for a new USMCA framework. He tied the issue directly to Ford’s ability to grow U.S. vehicle output, arguing that parts must be importable on commercially viable terms if the company is to expand production in its home market.

According to the report, Farley said Ford faced a $2 billion tariff bill in 2025 and expects a similar cost this year. He also pointed to recent tariff policy affecting the sector. In March 2026, President Donald Trump imposed 25% tariffs on vehicles and on auto parts imported into the United States, a change that Farley said makes tariff-free or reduced-tariff access to parts a central requirement for any successful trade arrangement.

Farley characterized the negotiations as active and wide-ranging, saying Ford is in heavy conversation with the Trump administration and the governments of Canada and Mexico on the new USMCA. The current pact was signed in 2020, and the agreement is up for review this year, giving automakers an opportunity to seek adjustments to the rules that govern cross-border trade.

A major focus for Farley was what he called a level playing field. The Detroit Free Press report says Ford wants significant penalties for competitors that do not comply with new USMCA requirements, including rules that can require a specified portion of automobile components and materials to originate from the United States (or qualify under the agreement) to receive preferential tariff treatment. In other words, Ford is asking for fewer loopholes that would allow companies to avoid the higher-cost sourcing demanded by the treaty while still shipping vehicles and parts with lower tariff exposure.

The CEO’s comments also referenced Ford’s broader operating footprint. The report says Ford has highlighted that it builds the most cars in the United States, employs the most workers represented by the United Auto Workers, and exports the most vehicles of any automaker from the U.S. Farley’s argument implied that trade policy outcomes now matter not just for pricing at the border, but also for whether production plans can be sustained or expanded without margin shocks.

Separately, Farley has previously warned about prolonged tariff levels on imports from Canada and Mexico. Automotive Logistics reported in February 2025 that he told audiences that a continued 25% tariff regime would have a huge impact on the industry, with billions of dollars of industry profits wiped out and adverse effects on jobs and customer prices. Those earlier remarks framed tariffs as a value-chain risk for the broader auto business, not merely a Ford-specific problem.

Even with that context, some key details remain unclear from the June comments. The Detroit Free Press report does not specify what new enforcement mechanisms Ford is seeking, such as which body would impose penalties or how compliance would be measured and audited in practice. It also does not lay out whether Ford is requesting additional carve-outs for certain part categories, or whether its priority is primarily to reduce tariff rates for qualifying imports under USMCA rather than to eliminate tariffs outright.

For automakers, the next watch item is how the review process addresses both sides of the equation Farley described: tariff treatment for incoming parts and credible consequences for non-compliance by rivals. If the final terms allow companies to keep importing parts at lower tariff cost while still ensuring that vehicles meet the sourcing rules required for preferential treatment, Ford may view that as supportive of U.S. volume plans. If tariffs remain high or enforcement is weak, Ford’s public messaging suggests the company expects continued financial strain from border costs.