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Ford Delivers $1.6 Bil Q1 Profit with Strongest North American Earnings in Over a Decade

But maker was hammered by problems in Europe.

by on Apr.24, 2013

CEO Alan Mulally and Chairman Bill Ford.

Ford Motor Co. topped Wall Street’s already optimistic earnings estimate with a 16% jump in first-quarter net income of $1.6 billion, or 40 cents per share.

That compared to last year’s 35-cent earnings and a 37-cent consensus estimate for the latest quarter among analysts polled by FactSet. The maker would have done still better were it not for problems in Europe which resulted in a $147 million decline in pre-tax earnings of $2.1 billion. But Ford’s results also were buoyed by the strongest results in North America in “at least” a decade.

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“Our strong first quarter results provide further proof that our One Ford plan continues to deliver,” said Alan Mulally, Ford president and CEO. “Our plan remains centered on serving customers in all markets around the world with a full family of vehicles — small, medium and large; cars, utilities and trucks — each with the very best quality, fuel efficiency, safety, smart design and value.”


Ford Counts on Escape Launch to Help Solve Capacity Problems

Maker losing sales, share, officials warn.

by on Jun.14, 2012

A worker installs a front end module on a new Ford Escape at the Louisville Assembly Plant.

With the formal production launch of its new Escape crossover-utility vehicle, Ford Motor Co. caps off a $600 million investment in its Louisville assembly plant, converting a traditional truck facility with limited flexibility to one that can handle six different car-based models simultaneously.

The project was meant to address several problems facing the automaker.  Among other things, the massive factory will now be able to more rapidly adapt to shifts in market demand.  But equally important, it is part of a broader effort by Ford to catch up to the surging U.S. market.  Company officials have been warning that Ford is likely to lose sales and market share this year because it is running short of capacity after years of factory cutbacks.

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“Louisville Assembly Plant’s reinvention illustrates how Ford is going further, continuing to invest in American manufacturing and new jobs,” proclaimed Ford President of the Americas Mark Fields, “while delivering even more of the fuel-efficient vehicles that give customers true power of choice.”


Ford’s Earnings: A Closer Look

Gains in North America run headlong into problems abroad, higher commodity prices.

by on Jan.27, 2012

Ford officials won't predict whether they can continue gaining share -- and raising prices -- even with the launch of key new products like the 2013 Ford Fusion.

Sometimes it can be difficult to please Wall Street.  As trading for the week neared its close the automaker’s shares were on track to drop about a half dollar as trader’s lamented the sort of figures that they might have only fantasized about during the depths of the Great Recession.  The maker reported a full-year pre-tax operating profit of $8.8 billion, or $1.51 a share, an increase of $463 million over 2010.

But what didn’t sit so well is that Ford still fell about a nickel a share short of early estimates, and more worrisome, total automotive pre-tax operating profits for the fourth quarter dipped to $586 million, a decrease of $155 million from the fourth quarter of 2010.

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What’s behind it all?  Analysts and company officials seem to agree on key factors including

  • Losses in both Europe and Asia Pacific;
  • Declining profits in the otherwise strong South American market;
  • Flooding in Thailand, in particular, hurt the maker in a number of regions; and
  • Commodity prices soared by about $100 million more than Ford initially planned for.


Debt Rating on the Rise, Will Ford Restore Dividend?

Maker gets vote of confidence with Fitch credit upgrade.

by on Oct.21, 2011

After an initial bump look for Ford's labor costs to come down, says President Mark Fields.

Editor’s Note: This story has been revised to reflect a subsequent upgrade in Ford’s credit rating by S&P, the agency removing Ford from its CreditWatch.

With a key debt rating agency giving it the thumbs-up – and further hikes anticipated – Ford Motor Co. is signaling it may soon restore its dividend, a move that could, in turn, help revive the maker’s flagging stock price.

With Ford now indicating its new contract with the United Auto Workers Union will actually lower its labor costs, Fitch Ratings bumped the carmaker’s credit rating up a notch to “BB+” on Thursday, S&P taking the same step on Friday while also removing Ford from its CreditWatch.  Those upgrades fall just one step short of reaching the investment grade targeted by Ford CEO Alan Mulally.

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In the past, it had been expected that Ford would wait until getting that investment grade status before restoring the dividend but, during a meeting with investors, Chief Financial Officer Lewis Booth indicated the additional upgrade, “is not an absolute necessity to pay dividends.”

If anything, analysts say such a move would pay big dividends for Ford.  The quarterly payout is a requirement in some investment communities, such as insurance companies and government pension plans, according to Joe Phillippi, chief analyst with AutoTrends Consulting.


Ford Earnings Likely to Be Strong

Analysts forecasting strongest Q1 since 1998.

by on Apr.25, 2011

The emphasis is on "profitable growth," according to Ford CEO Alan Mulally.

It’s been a challenging couple of months for the auto industry.  There’s the near-record run-up in petroleum prices, and the Japanese parts shortage that has crippled makers around the world.  Raw material costs have been soaring.  And the economies of some key auto markets have been in the doldrums.

Yet, you might not even notice if you simply watch Ford Motor Co., industry and financial analysts suggest – forecasting that the maker will tomorrow report its strongest first quarter profit since 1998.

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Earnings are forecast to reach as high as 50 cents a share, a nearly 10% rise from the 46 cents reported for the January – March quarter of 2010.  Net income, according to a consensus of analysts, is expected to reach $2.1 billion, the largest figure for the quarter since Ford generated net income of $17.6 billion in 1998.

Such numbers could help quell concerns about the vitality of the auto industry at a time when investors have been pulling back, anticipating serious problems as fuel prices soar – especially for Detroit makers traditionally dependent upon low-mileage light trucks.