Who'd of ever thunk this?
Ford Motor Co. Reports 3Q Loss of $284M
Thursday October 20, 8:22 am ET
By Dee-Ann Durbin, AP Auto Writer
Ford Motor Co. Reports Third-Quarter Loss of $284 Million on Weak North American Results
DEARBORN, Mich. (AP) -- Ford Motor Co. reported a third-quarter loss of $284 million on Thursday, dragged down by its North American division where it lost more than $1 billion. Its shares slipped in premarket trading.
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The nation's second biggest automaker lost 15 cents per share for the three months ended Sept. 30 in contrast to a profit of $266 million, or 15 cents per share, in the year-ago quarter.
Revenue for the quarter rose to $40.9 billion from $39.1 billion in 2004.
Excluding special items, Ford lost $191 million, or 10 cents per share. Special items included a charge of $180 million related to Ford's agreement to take back some unprofitable plants from Visteon Corp., its former parts division, and a charge of $158 million for reduction of employees. Ford has announced plans to cut its salaried staff by 2,750 this year.
Wall Street had predicted a loss of 10 cents per share, according to analysts surveyed by Thomson Financial.
Its shares fell 13 cents to $8.34 in premarket trading.
Ford said full-year earnings likely will be at the low end of the current guidance of $1 to $1.25 per share.
"As our results indicate, we face many challenges in this competitive and difficult environment," Ford Chairman and CEO Bill Ford said.
Ford reported a $1.2 billion pretax loss in its North American automotive operations, compared to a $481 million loss a year ago. The automaker said lower dealer inventories, lower net pricing and higher material and warranty costs contributed to the decline.
Ford Motor Credit Co., the company's finance arm, reported a profit of $577 million, down $157 million from a year ago. The decrease was due to higher borrowing costs, the company said.
Ford also announced Thursday it will be airing a new television ad campaign featuring Bill Ford talking about innovation, including the company's goal of creating more fuel-efficient vehicles. Ford announced last month it will make gas-electric hybrid systems available on half its Ford, Lincoln and Mercury vehicles by 2010. Bill Ford last appeared in ads for the company in 2002. He is the great-grandson of company founder Henry Ford.
Ford is the second U.S. automaker to report a loss this week. On Monday, General Motors Corp. said it lost $1.6 billion in the third quarter, or $2.89 per share, compared to a profit of $315 million, or 56 cents a share, a year ago.
GM also announced a tentative agreement with the United Auto Workers that would lower the automaker's health care costs by $3 billion a year before taxes and would lower its retiree health care liabilities by $15 billion, or 25 percent. GM's hourly workers still must ratify the deal.
Ford has said it is already in discussions with the UAW to match that agreement.
Ford said its worldwide automotive pretax losses were $1.3 billion for the quarter. That is more than double the $609 million loss of a year ago. Worldwide sales were 1.5 million vehicles, up slightly from the year before.
The company's Premier Automotive Group, which includes the Jaguar, Volvo and Land Rover brands, reported a pretax loss of $108 million for the quarter, up from a $171 million loss last year. Ford said the increase was due to a better mix of products and improved pricing at Land Rover.
Ford's European operations reported a pretax loss of $55 million, compared to $33 million a year ago. Ford's Asia-Pacific operations reported a pretax profit of $21 million, a decline from $35 million a year ago.
Ford Motor Co.: ford.com |
