Ford’s F-150 chokepoint shows limits of trade war

FORD MOTOR CO. has been hit by not one but two butterfly effects.

- LIAM DENNING

Afire last month at an aluminium mill in upstate New York, disrupting production of its trucks including the F-150 pickup, will chop the automaker’s expected annual operating profit by $1.5 billion to $2 billion, or roughly a quarter. Meanwhile, the erratic trade war being waged out of the White House construction site will have taken another billion dollars off. This is less than what was anticipated up until another tariff carve out was announced a week or so ago, but still a billion dollars.

These two particular butterflies are linked. Aluminium imports have been subject to 50% tariffs imposed by President Donald Trump since June, with heavy users of the metal—such as automakers—taking a hit to profits or passing on the increase to consumers. In theory, those tariffs will reshore aluminium production currently dominated by—you guessed it—China, helping to avoid the sort of chokepoints revealed by that plant fire. In practice, there are some complicating factors spanning artificial intelligence, inflation and the president’s fractious relationship with Canada, which took another bad turn on Friday over a snarky television ad.