Ford Posts Slight Earnings Rise as Higher Prices Boost Results – BNN Bloomberg

Ford Motor Co. slightly beat earnings expectations in the first three months of the year as higher prices offset supply chain problems that have limited production.

A day after launching an electric version of the F-150 pickup truck, Ford on Wednesday posted adjusted earnings per share of 38 cents, topping the 36 cents analysts had forecast on average. Adjusted earnings before interest and taxes of $2.3 billion exceeded the $1.8 billion expected by analysts.

“It was mixed,” Ford Chief Financial Officer John Lawler said of the company’s first-quarter performance on a call with reporters. “We continue to have issues with chip supply, which has limited us and, particularly here in North America, disproportionately affected us in our large vehicles, F-Series, Expedition, Navigator.”

The automaker reiterated its 2022 earnings guidance of $11.5 billion to $12.5 billion before interest and taxes. That would represent a 15% to 25% gain over 2021 earnings.

Ford’s revenue in the latest quarter was about half the level of a year ago, when it reported first-quarter profit of $3.9 billion, or 70 cents a share. The results also compared poorly with rival General Motors Co.’s first-quarter profit of $2.09 a share, excluding some items. GM also left its full-year outlook unchanged, saying it expected to improve access to chip supplies in the second half.

The launch of the battery-powered F-150 Lightning is the culmination of a $50 billion bet by CEO Jim Farley that the 118-year-old automaker can challenge Tesla Inc. and become a player in the electric vehicle race But Ford is beset by an intractable chip shortage that cut F-series truck sales by 31 percent in the US in the first quarter.

Ford shares more than doubled last year, but investors have turned cold on the automaker amid recession concerns and rising raw material costs that are exacerbated by the war in Ukraine.

Ford’s first-quarter revenue of US$34.5 billion, topping the US$32.2 billion analysts had expected. However, wholesale shipments of nearly 970,000 vehicles fell 9 percent from a year earlier, the latest evidence that chip shortages are hurting performance. Ford’s first-quarter revenue fell just 5 percent for the year, a reflection of higher sticker prices.

Since Ford surpassed $100 million in market value for the first time on Jan. 13, the company’s shares have fallen 40 percent. In after-hours trading, Ford shares rose 2.7 percent to $15.25 at 4:43 pm in New York trading.

To shift Ford’s shift to electric vehicles, Farley on March 2 split the automaker into two units: “Model e” to expand electric vehicle offerings and “Ford Blue” to focus on traditional diesel-powered vehicles. internal combustion. Farley is targeting $3 billion in cost cuts at legacy operations that build gas vehicles, and that could include job cuts. Farley has said that traditional car manufacturing operations will be the “profit and cash engine” that will finance Ford’s electric ambitions.

Farley last month also boosted Ford’s spending on electric vehicles by $20 billion to a total of $50 billion, with a plan to make 2 million electric vehicles a year by 2026, a big jump from the most 27,000 battery-powered Mustang Mach-E. SUV that he sold last year.

Ford reported earnings before interest and taxes in North America of US$1.59 billion, up from US$2.95 billion a year earlier. In the first three months of the year, Ford’s U.S. vehicle sales fell 17 percent, while the average prices car buyers paid for its models rose 3.1 percent to $49,343, amid continued inventory shortages, according to auto researcher

In Europe, Ford posted a $207 million profit before interest and taxes in the first quarter, down from last year’s $341 million profit before interest and taxes.

In China, Ford lost $53 million before interest and taxes in the first three months of the year, worse than the $15 million loss on that basis in the first quarter of 2021. Ford vehicle sales fell 18.8 percent in China in the first quarter. quarter, limited by chip shortages and pandemic-related restrictions.

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