Ford Motor Co. has pulled its full-year financial forecast and warned of a potential $1.5 billion (€1.39 billion) blow to its profits this year due to escalating trade tariffs and uncertainty surrounding U.S. trade policy.

In its first-quarter earnings report released Monday, the automaker cited unpredictable market conditions stemming from the Trump administration’s evolving tariff regime as the key reason for suspending its guidance. While Ford is less exposed than some competitors thanks to its strong U.S. manufacturing base, the company acknowledged that the threat to supply chains remains significant.

“Given the potential range of outcomes, updating full-year guidance is challenging right now,” the company said in a statement. Ford had previously projected earnings before interest and taxes between $7 billion and $8.5 billion (€6.2–7.5 billion) for 2025.

CEO Jim Farley emphasized the advantage of domestic production, noting that Ford’s U.S.-focused footprint places it in a stronger position relative to global rivals. “Automakers with the largest U.S. footprint will have a big advantage, and, boy, that is true for Ford,” Farley said during an earnings call. “But it’s too early to gauge the full impact of industry-wide supply chain disruptions.”

Chief Operating Officer Kumar Galhotra pointed to rare earth materials from China as a growing area of concern, noting that “it would take only a few parts to potentially cause some disruption to our production.”

Despite the growing challenges, Ford’s first-quarter results beat analyst expectations. Net income fell sharply to $471 million (€417 million), a drop of nearly two-thirds from $1.33 billion (€1.17 billion) a year earlier. Revenue declined by 5% to $40.7 billion (€35.9 billion), driven by planned plant shutdowns tied to new product rollouts and inventory adjustments.

The automaker’s results surpassed projections by analysts surveyed by FactSet, who had estimated quarterly revenue of $38 billion (€33.5 billion).

Ford’s relatively limited exposure to tariffs contrasts with peers such as General Motors, which last week warned of a potential $5 billion (€4.4 billion) hit from similar trade actions. Tesla and Ford, with larger U.S.-based production operations, are considered better insulated.

Still, Ford does anticipate modest price increases of 1% to 1.5% in the U.S. auto market during the second half of the year as a result of higher costs for imported cars and parts.

The company plans to provide updated financial guidance when it releases its second-quarter earnings later this year.

Private equity firms are stepping up their investments in the global travel and tourism industry, targeting hotels, resorts, restaurants, and tour operators as they seek to capitalise on a sector rebounding strongly after the COVID-19 pandemic.

In the second quarter of 2024 alone, private equity (PE) deals in Europe’s tourism and leisure industry totalled nearly $823 million (€724.4 million), according to GlobalData. One standout transaction saw Ares Management Corporation and EQ Group acquire Landsec’s hotel portfolio in the UK for £400 million (€466.7 million).

Analysts say this uptick in activity is driven by multiple factors, including improved travel demand, constrained supply in prime tourism locations, and a growing preference for luxury and wellness experiences over material goods. During the pandemic, PE firms had already begun snapping up undervalued travel assets, anticipating future growth.

“Private equity now accounts for around 40% of M&A activity in the UK travel sector,” said Andrew Keller, director at Stax Consulting. “We’re seeing strong interest in tech-enabled and experiential travel firms, with many PE players adopting buy-and-build strategies.”

Graham Miller of the Nova School of Business & Economics notes that the hotel, resort, and restaurant sectors have seen significant PE interest. Investments are also rising in travel infrastructure and service firms, especially in emerging destinations like Central Asia and Scandinavia.

Demographic trends are also playing a role. “Affluent baby boomers nearing retirement are expected to drive higher future demand, while regulatory and construction cost barriers make acquiring existing hotels more attractive than building new ones,” explained Dr. René-Ojas Woltering of EHL Hospitality Business School.

To boost profitability, PE firms often remodel properties, streamline operations, introduce new technologies, and target high-margin segments such as luxury and group travel. In some cases, they also restructure debt and integrate AI tools to improve operations.

However, this aggressive transformation comes with challenges. Labour shortages, rising costs, regulatory barriers, and cultural clashes between investors and company founders can complicate the path to profitability. Maintaining service quality while implementing cost-cutting measures also remains a delicate balancing act.

“The alignment of investor goals with the company’s long-term vision is essential,” Miller said. “If not managed well, private equity involvement can threaten brand identity and sustainability.”

Despite macroeconomic uncertainties, the resilience of the travel sector continues to attract PE interest, as consumers remain eager to explore—albeit on shorter or more budget-conscious trips.