Ford on Monday announced third quarter net income of US$997m, up $1.2bn from the third quarter of 2008, pre-tax operating profit up $3.9bn to $1.1bn – its first pre-tax operating profit since the first quarter of 2008 – and an operating profit of $357m at its North America operations, the first quarter in the black since Q1 2005. It has also revised its full-year 2011 guidance for total company and North American automotive operations from “break even or better” to “solidly profitable”, pre-tax.
Go deeper with GlobalData
South American, European and Asia Pacific Africa regional units also posted pre-tax operating profits in the third quarter.
Third quarter revenue was $30.9bn, down $800m year on year though automotive revenue was up $100m.
“Our third quarter results clearly show that Ford is making tremendous progress despite the prolonged slump in the global economy,” said president and CEO Alan Mulally.
Automotive structural costs were reduced by another $1bn in the quarter as productivity improved, personnel cuts were made in North America and Europe and further progress was made on common global platforms and product development processes. Ford said it achieved $4.6bn in automotive structural cost reductions in the first nine months, exceeding its full-year 2009 target of $4bn.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataAutomotive operations reported a pre-tax operating profit of $446m, compared with a pre-tax loss of $2.9bn a year ago.
Worldwide automotive revenue in the third quarter was $27.9bn, up $100m from a year ago. Total vehicle wholesales in the third quarter were 1,232,000, compared with 1,175,000 units a year ago.
Ford North America reported a pre-tax operating profit of $357m, compared with a loss of $2.6bn a year ago,
South America reported a pre-tax operating profit fell to $247m, compared with $480m a year ago, as exchange rates hit, Ford Europe boosted pre-tax operating profit to $193m from $69m, helped by structural cost reductions, and Asia Pacific Africa regional pre-tax operating profit rose to $27m from $4m.
Up-for-sale Volvo reported a pre-tax operating loss of $135m, compared with a loss of $458m a year ago, helped by cost reductions, favourable exchange, and higher volume and mix. Third quarter revenue was $3bn, up from $2.9bn a year ago.
The financial services sector reported a pre-tax operating profit of $661m, compared with a profit of $159m a year ago.
Ford said it remains on track to achieve or exceed all of its 2009 financial targets and almost all of its operational metrics but will also continue to pursue actions to improve its balance sheet.
It expects full-year 2009 US industry sales unchanged at about 10.6m units but 15.7m units in Europe, which is higher than its previous guidance.
Fourth quarter 2009 production is expected up compared with year-ago levels and third quarter 2009 production to return to planned dealer stock levels and match production with market demand.
“Going forward, Ford expects structural costs to be relatively stable as the company has largely completed its significant restructuring actions over the past four years,” the automaker said.
It is changing its full-year 2011 guidance for total company and North American Automotive operations from being “break even or better” to “solidly profitable” on a pre-tax basis excluding special items, with positive automotive operating-related cash flow.
“While the company has confidence that the global economy will be improving by 2011, the near-term growth outlook remains rather uncertain. Looking at 2010, there is a high likelihood of a substantial decrease in European industry volume as scrappage programs expire. This decrease could more than offset US sales volumes, which may improve somewhat from this past quarter’s levels,” Ford said.
“The third quarter is one the entire Ford extended team can be proud of because it proves that our product-led transformation is working,” Mulally added.
“Leading indicators are now showing signs of recovery in all of our major markets, however, consumer confidence and labour market conditions remain a concern.”
