Detroit Bureau on Twitter

Archive for the ‘Earnings’ Category

Automakers Caught “In Limbo” As New CAFE Rules Face Major Legal Hurdles

Anticipated court battle could delay changes for years.

by on Aug.03, 2018

Automakers are caught in the middle over the CAFE debate and could face even more challenges if the proposed Trump rollback drags on in court.

Despite, or perhaps because of, the Trump Administration’s plan to roll back the Corporate Average Fuel Economy, automakers are finding themselves in what one long-time industry analyst calls “limbo,” and it could be a year or more before they’ll actually be able to incorporate the CAFE update into their plans due to anticipated legal challenges.

As a result, it could be well into the upcoming decade before the White House revisions actually have any significant impact, according to numerous industry executives who spoke to TheDetroitBureau.com, if any changes ever actually occur.

Insight!

There is the very real possibility that the courts could rule against the proposed changes or that the legal battle drags on long enough for a new administration to come into office and revert back to the guidelines established under the Obama White House. As a result, automakers and suppliers face a major conundrum when it comes to planning for products set to come out through the middle of the coming decade.

(more…)

Toyota Motor Reports Increased Q1 Profits

Strong sales in U.S. and cost-cutting efforts pave way to profits.

by on Aug.03, 2018

Toyota's Masayoshi Shirayanagi noted that increased trade tensions and U.S. tariffs will eat into Toyota's bottom line.

Toyota Motor Corp. rode a wave of increased sales and decreased costs to a 7.2% increase in net income in its fiscal first quarter of 2018. Revenues also increased 4.5% during the quarter.

The company also announced it was ending its partnership with Isuzu Motor Ltd. The companies built diesel engines, but with oil burners falling out of favor, replaced by EVs and potentially fuel cells down the road, the two sides will split.

We Keep You In the Know!

Toyota owns a 5.89% stake in Isuzu. (more…)

Tesla Q2 Losses Double, But Profits Promised in Q3

Investors happy to see capex spend drop, stock jumps nearly 5%.

by on Aug.01, 2018

Tesla CEO delivered enough positives in the second quarter to excite investors. The company's stock rose 5% in after hours trading.

Tesla Inc.’s mad dash efforts to meet its ever-shifting production quotas didn’t result in a narrowing of financial losses for Q2, not that CEO Elon Musk implied that. However, the end result was a doubling of losses on a year-over-year basis.

In the second quarter of 2018, Tesla’s automotive business saw revenue rise to $3.1 billion compared with $2 billion for the same period last year; however, losses jumped to $717.5 million, or $4.22 a share, from $336.4 million, or $2.04 a share.

News Now!

However, the letter produced to explain the quarterly results suggests that only good times are on the horizon despite the company missing analyst expectations for losses this quarter. Ultimately, shareholders were pleased with the results as the stock jumped nearly 5% after hours on the news.  (more…)

Could Ford Be Working Up a Sub-Ranger Pickup?

One option would be to go with a car-based package.

by on Aug.01, 2018

The Ford Courier pickup shared platforms with the automaker's Fiesta subcompact.

Several sources are reporting that Ford Motor Co., long reluctant to undercut its full-size F-Series pickup family, could soon have small trucks in its line-up, with a model even smaller than the upcoming Ranger to follow by as early as 2022.

Exactly what it would look like and where it would fit into the spectrum isn’t clear but Automobile magazine’s sources suggested Ford might be looking at a product like the old Courier pickup built in Brazil that was based on the same platform as the prior-generation Fiesta subcompact.

Insight!

Whether there’d be a market for something the size of the old Ford Courier is far from certain, though several automakers appear to be looking at their options, notably including Hyundai which has been slowly moving forward with a production version of the well-received Santa Cruz concept first shown at the Detroit Auto Show in January 2015.

(more…)

Auto Suppliers Growing Pessimistic About Near-Term Prospects

Trump trade policies causing negative outlook.

by on Jul.31, 2018

Auto suppliers are concerned about their near-term prospects due to Trump administration trade policies.

The near-term outlook among both large and small automotive suppliers is growing more pessimistic, according to a new survey.

Despite a relatively strong sales and production environment, the darker outlook prevails due to trade policy uncertainty across the automotive supply base in the third quarter of 2018.

Stay in the Loop!

The OESA Automotive Supplier Barometer, a quarterly survey of executives at North American automotive suppliers on their 12-month outlook, posted a negative reading of 43 for the third quarter of 2018, seven points below a neutral level of 50. (more…)

Trump Mileage Rules Could Cost U.S. Motorist $Billions

But White House claims “societal cost” savings of $500 billion.

by on Jul.30, 2018

You may be spending significantly more at the pump under the CAFE rollback plan.

The planned revisions to the Corporate Average Fuel Economy, or CAFE, standards set to be announced by the Trump Administration could save as much as $500 billion in “societal costs,” according to a draft proposal revealed over the weekend – but on an individual basis, motorists could wind up spending thousands of dollars each, while the potential to the environment may also be substantial, as the new plan could increase U.S. fuel consumption by as much as 500,000 barrels a day.

In April, former Environmental Protection Agency chief Scott Pruitt took the first steps towards officially rolling back the rules set by the Obama Administration which would steadily increase the fuel economy of the average vehicle sold in the U.S. to 54.5 mpg in 2025. The draft of a plan crafted jointly by the EPA and the National Highway Traffic Safety Administration published over the weekend by the New York Times would freeze mileage standards at a level reached by 2020 – or around 37 mpg.

We Keep You In the Know!

The draft appears to have been completed in May, and sources have told several news outlets that revisions could be made before the final proposal is released – something that could happen as early as this week, according to comments made by Andrew Wheeler, the former coal industry lobbyist and acting EPA chief who took over the agency after Pruitt was forced out due to ethical concerns.

(more…)

Ford Q2 Earnings Hurt by China, Supplier Fire

Automaker revises full-year guidance downward.

by on Jul.25, 2018

Jim Hackett, Ford president and CEO, said the company is moving to invest in areas that will return the best profits.

Ford’s second-quarter earnings were down compared with year-ago results, driven there by poor sales in China and the loss of truck sales when its supplier suffered a fire that forced the company to shut down its truck production lines for eight days.

The automaker reported net income of $1.1 billion, or 27 cents a share, on revenue of $38.9 billion, compared with 2017 results of net income of $2.1 billion, or 51 cents a share, on revenue of $39.9 billion.

News Now!

“This quarter we achieved solid results in North America, offset in part by unexpected challenges with our overseas operations and headwinds in the business environment,” said Jim Hackett, president and CEO, in a statement. (more…)

FCA Reports Lower Than Expected Earnings as it Mourns Marchionne

Former chief memorialized with a moment of silence on earnings call.

by on Jul.25, 2018

Mike Manley, new CEO of FCA, led a moment of silence today before leading the reporting of the company's second quarter earnings.

Fiat Chrysler Automobiles reported Q2 earnings that were lower than expected, but that was surpassed by news that former CEO Sergio Marchionne died due to complications from surgery in Switzerland.

The company’s executives, including the newly appointed replacement for Marchionne, Mike Manley, soldiered on through the earnings call, starting with a moment of silence to honor the man many believe saved Chrysler from extinction.

Subscribe Now!

Then they moved on, as they believed Marchionne would have insisted, to describe how slow sales in China put a drag on the company’s earnings results despite impressive sales in North America during the first half of the year. (more…)

General Motors Reports Flat Earnings for Second Quarter

Rising incentives on pickups drain profits.

by on Jul.25, 2018

GM's profits were hurt by increased incentives on its full-size pickups during the second quarter.

General Motors posted earnings for the second quarter that were basically flat as rising incentives and lower prices on its pickup trucks took a bite out of the company’s profits.

GM’s income from continuing operations of $2.4 billion, down $0.1 billion, compared to the second quarter of 2017 due to a driven primarily by the decline pricing and trim mix for the company’s the current-generation full-size pickup truck models, which is due to be replaced next year, and increased commodity costs.

Financial News!

The decline in the profitability of the company’s pick-up truck business was partially offset by improved performance in GM Financial and China. (more…)

Former FCA CEO Marchionne Dead of Stroke at 66

A “force of nature,” the Italian-born exec rescued two car companies.

by on Jul.25, 2018

Sergio Marchionne was a dynamic game-changer that many could only watch as he raced by.

Sergio Marchionne, a man more than once called “a force of nature,” has died from a stroke at the age of 66, an unexpected complication following what had been expected to be “routine” shoulder surgery last week.

In an era when many businesspeople crave anonymity, Marchionne’s public appearances often turned into events, rather than mere news conferences. And perhaps for good reason considering there are few executives who could lay claim to having saved two separate automakers, Fiat and Chrysler, before bringing them together to form a global powerhouse.

Word that something had gone wrong came around noon Eastern time on Saturday when FCA issued a brief statement revealing that the Italian-born and Canadian-educated Marchionne experienced “unexpected complications,” and that his conditions had “worsened significantly in recent hours.” Subsequent news reports from Europe indicated the executive had suffered a stroke, fallen into a coma and was placed on a ventilator at a Swiss hospital. FCA issued another terse statement indicating his passing early this afternoon in Europe.

(more…)