Official

Trump says tariffs mean Ford can build Focus Active in U.S.; Ford says it won't

Ford maintains car wouldn't be profitable at expected low volumes

President Trump waded into the global auto industry again in his ongoing trade war over the weekend, tweeting on Sunday about Ford's decision not to import its Focus Active from China because of import tariffs and proclaiming, "This car can now be BUILT IN THE U.S.A." where the company would pay no tariffs. Ford abruptly issued a statement saying essentially, yeah, not so much.

Trump's tweet appears to have been a response to a report about the Focus Active on CNBC, and it elicited the following response from the Blue Oval:

"It would not be profitable to build the Focus Active in the U.S. given an expected annual sales volume of fewer than 50,000 units and its competitive segment. Ford is proud to employ more U.S. hourly workers and build more vehicles in the U.S. than any other automaker."

Ford last month said it was scrapping plans to import the Focus Active crossover from China because of the steep 25 percent tariffs Trump has imposed on China, where the vehicle is built, would make it impossible for Ford to hit its profit targets. The car had been set to replace the Focus in the U.S., with the Focus Active going on sale in the second half of 2019. Now, the change in plans leaves the Mustang as the lone passenger car with a long-range future in Ford's domestic lineup as the company doubles down on trucks, SUVs and commercial vehicles.

As The New York Times notes, it was the second such tweet in as many days, after Trump on Saturday called on Apple to begin making iPhones in the U.S. if it wanted to avoid import tariffs. Easy, right?

"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 advises automakers and suppliers, told the Detroit Free Press.

Trump followed his tweet about the Focus Active with another outlining his rationale for waging a trade war against China. But as the Free Press notes, it was full of inaccuracies. China lowered its 25-percent tariff to 15 percent for World Trade Organization members like the U.S. but raised it to 40 percent after Trump enacted his 25 percent tariffs. The U.S. also charged 2.5 percent, not 2 percent, prior to the new tariffs on China-made goods, meaning imports from that country now face a 27.5-percent tariff.

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