Ford Motor Company shares advanced on Friday, closing the trading session at $14.01, a gain of 1.7%. Trading volume was substantial, with approximately 67 million shares changing hands. The stock moved within a range of $13.72 to $14.04 throughout the day.
Supreme Court Overturns Tariffs, Refunds in Question
The financial markets focused intently on trade policy developments following a landmark decision by the U.S. Supreme Court. The court struck down the sweeping emergency tariffs enacted during the Trump administration under the International Emergency Economic Powers Act. While the ruling invalidates the legal basis for those duties, it left a significant question unanswered: the process for potential refunds to companies that paid them. Tom Graff, Chief Investment Officer at Facet, noted that the court's decision did not address the refund issue, leaving considerable uncertainty.
This ruling has direct implications for automakers like Ford, which operate complex cross-border supply chains. The company had previously informed investors it was anticipating around $2 billion in costs this year linked to the Trump-era tariffs, a significant portion related to aluminum used in its flagship F-150 trucks. Against this backdrop, Ford has provided an earnings before interest and taxes (EBIT) target for 2026 in the range of $8 billion to $10 billion.
New USMCA Automotive Rules Investigation Launched
Adding another layer of trade policy scrutiny, the U.S. International Trade Commission (USITC) initiated a fact-finding investigation on Thursday. The probe will examine the automotive rules of origin under the United States-Mexico-Canada Agreement (USMCA). These rules, which require 75% North American content for duty-free vehicle trade and include specific mandates for core parts, are critical for the industry's cost structure and supply chain planning.
The USITC investigation will assess the economic impact of these rules on the United States. The commission plans to hold a public hearing before the end of the year and is scheduled to deliver its final report by July 2027. The findings could influence future trade negotiations and enforcement.
Market Context and Broader Implications
U.S. equity markets closed higher on Friday, with investors showing interest in sectors sensitive to tariff developments, alongside major technology stocks. Economic data released showed U.S. growth cooled more than anticipated in the previous quarter, while inflation measures ticked higher in December. The S&P 500 index rose 0.69%, the Nasdaq Composite advanced 0.90%, and the Dow Jones Industrial Average climbed 0.47%.
The legal and policy battle now shifts to the unresolved matter of tariff refunds. Analysts from the Penn-Wharton Budget Model estimate that over $175 billion in collected tariff revenue could potentially be subject to repayment. Kent Smetters, the model's director, stated the court's decision "clearly does open that door" for companies seeking reimbursements. In response to the ruling, former President Trump replaced the overturned tariffs with a new, temporary 10% global import duty, set for a 150-day duration, and initiated fresh trade investigations under different statutory authorities.
It is crucial to note that the court's decision does not automatically translate to lower costs for manufacturers. The new replacement tariffs, should they persist or expand, could swiftly negate any potential benefits for companies reliant on imported components. Furthermore, undertaking another significant overhaul of supply chains to navigate the changing trade landscape carries its own substantial cost.
As U.S. markets prepare to reopen on Monday, February 23, 2026, investors in Ford and other affected companies will be keenly watching for specific details regarding the administration's new tariff plan and any early indications about how the refund process might be structured. The interplay between these regulatory actions and corporate financial planning will likely drive market sentiment in the coming sessions.
