Ford has decided to withdraw its profit forecast for the whole year, as announced this Thursday when presenting its third quarter results. The reason is that the company needs to evaluate the impact on its accounts of the automobile strike and the new collective agreement preliminarily agreed with the motor union, United Auto Workers (UAW). It follows in the footsteps of General Motors, which has not yet reached an agreement and which also decided this week to withdraw its forecasts.
“Given the effects of the UAW strike and with the ratification of the provisional agreement with the union that was announced Wednesday night still pending, Ford is withdrawing its forecasts for operating results for the full year 2023,” the company said. it’s a statement.
In the third quarter, the company based in Dearborn (Michigan) increased its sales by 11%, up to 43,801 million dollars (about 41,500 million euros at the current exchange rate), compared to the same period last year, thanks especially to the increases in car prices. The group achieved a profit of 1,199 million dollars, compared to losses of 827 million a year earlier, according to the accounts published by the company.
In the accumulated of the first nine months of the year, sales grow by 14%, up to 130,229 million dollars. Between January and September, the group has earned 4,873 million dollars, compared to red numbers of 3,270 million in the same period last year. In July, Ford raised its forecast for net operating income, before interest and taxes, to a range of $11 billion to $12 billion. In the first nine months it accumulates 9.4 billion, 20% more than last year.
“We are radically changing the way we work with a series of actions that put the right people with the right skills in the right places in the organization, so that our promise is not masked by cost and quality problems,” he said in a statement from Ford CEO Jim Farley, which does not detail which quality and cost problems specifically he is referring to.
Ford has agreed with the unions for salary increases of 25% in four years, which are actually greater than 30% when other parts of the agreement are taken into account. The company hopes that will allow the approximately 20,000 workers who are on strike at three of its factories to return to work.
The third quarter figures exceed analysts’ forecasts in terms of revenue, but fall short in terms of profits. Stocks have reacted with declines outside of normal trading hours.
A 7.7% increase in U.S. vehicle sales during the quarter, along with strong pricing, bolstered Ford’s results on its traditional combustion-engine models, such as the Bronco SUV and pickup truck. F-150. That unit, known as Ford Blue, posted earnings before interest and taxes of $1.718 billion in the third quarter, below analysts’ average forecast of $1.94 billion. Income grew in that business by 7%, up to 25.6 billion.
Ford’s difficulties in its nascent electric vehicle business, known as Model e, resulted in a loss before interest and taxes of $1.329 billion, higher than analysts expected, “attributable to continued investment in electric vehicles.” of new generation and the difficult dynamics of the market”, according to the company. Revenue from the electric car business grew 26% in the quarter, but still contributed only $1.8 billion. Sales of Ford’s flagship electric vehicle, the F-150 Lightning pickup truck, plummeted 46% in the quarter as the company closed its factory for expansion, delayed delivery of vehicles for quality checks and temporarily laid off factory workers. plant.
Ford’s commercial business, known as Ford Pro, posted net operating income of $1.654 billion, below the $2.16 billion expected by analysts. The turnover of this division amounted to 13.8 billion dollars, with an increase of 16%.
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