Ford Reports Nearly $9B Loss
Ford Motor Co. said Thursday it lost $8.67 billion in the second quarter largely because of a reduction in the value of assets.
The company also announced that it will bring six European small car models to North America by the end of 2012 as it deals with a market shift from trucks to cars brought on by high gasoline prices. The company also will retool two more North American truck and sport utility vehicle plants to build small, fuel-efficient vehicles.
The second-quarter loss was $3.88 per share, compared with net profit of $750 million, or 31 cents per share, in the same quarter a year ago.
The loss includes $8.03 billion worth of write-offs because of a decline in value of North American assets and Ford Motor Credit Co.'s lease portfolio. Even excluding those special items, Ford lost 62 cents per share, worse than Wall Street expected. Twelve analysts surveyed by Thomson Financial, on average, expected a 27 cent loss per share.
Ford's second-quarter revenue was $38.6 billion, down $5.6 billion from the year-ago period. Analysts expected $34.6 billion.
Ford said it will retool the Michigan Truck plant in suburban Detroit, shifting its products from large SUVs to make global vehicles off the European Focus platform by 2010.
The SUVs made at Michigan Truck - the Lincoln Navigator and Ford Expedition - will be shifted to the Kentucky Truck plant in Louisville.
The company also will retool the Louisville Assembly Plant, which now builds the Ford Explorer midsize SUV, to produce vehicles on the European Focus frame, starting in 2011.
Ford also said its Twin Cities Assembly Plant in St. Paul, Minn., will continue producing the Ranger small pickup through 2011. The plant was scheduled to close next year.
Ford also said in a statement that it does not expect a U.S. economic recovery to start until early 2010.
The company said its write-offs included $5.3 billion in North America and $2.1 billion in write-downs for Ford Credit's truck-heavy lease portfolio. Chief Financial Officer Don Leclair said most of the write-down was triggered by the drop in value of the company's truck and SUV inventory and lease residuals.
Ford reported a pretax loss of $1.3 billion in North America because of the deteriorating U.S. market and the shift away from trucks. U.S. sales overall were down 10 percent in the first half of the year, with Ford's sales down 14 percent.
The company, though, continued to be profitable overseas, posting a $582 million profit in Europe and $388 million in South America. The company also made $50 million at its Asia-Pacific-Africa division.
"The second half will continue to be challenging, but we have absolutely the right plan to respond to the changing business environment and begin to grow again for the long term," President and CEO Alan Mulally said in a statement.
© 2009 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The company also announced that it will bring six European small car models to North America by the end of 2012 as it deals with a market shift from trucks to cars brought on by high gasoline prices. The company also will retool two more North American truck and sport utility vehicle plants to build small, fuel-efficient vehicles.
The second-quarter loss was $3.88 per share, compared with net profit of $750 million, or 31 cents per share, in the same quarter a year ago.
The loss includes $8.03 billion worth of write-offs because of a decline in value of North American assets and Ford Motor Credit Co.'s lease portfolio. Even excluding those special items, Ford lost 62 cents per share, worse than Wall Street expected. Twelve analysts surveyed by Thomson Financial, on average, expected a 27 cent loss per share.
Ford's second-quarter revenue was $38.6 billion, down $5.6 billion from the year-ago period. Analysts expected $34.6 billion.
Ford said it will retool the Michigan Truck plant in suburban Detroit, shifting its products from large SUVs to make global vehicles off the European Focus platform by 2010.
The SUVs made at Michigan Truck - the Lincoln Navigator and Ford Expedition - will be shifted to the Kentucky Truck plant in Louisville.
The company also will retool the Louisville Assembly Plant, which now builds the Ford Explorer midsize SUV, to produce vehicles on the European Focus frame, starting in 2011.
Ford also said its Twin Cities Assembly Plant in St. Paul, Minn., will continue producing the Ranger small pickup through 2011. The plant was scheduled to close next year.
Ford also said in a statement that it does not expect a U.S. economic recovery to start until early 2010.
The company said its write-offs included $5.3 billion in North America and $2.1 billion in write-downs for Ford Credit's truck-heavy lease portfolio. Chief Financial Officer Don Leclair said most of the write-down was triggered by the drop in value of the company's truck and SUV inventory and lease residuals.
Ford reported a pretax loss of $1.3 billion in North America because of the deteriorating U.S. market and the shift away from trucks. U.S. sales overall were down 10 percent in the first half of the year, with Ford's sales down 14 percent.
The company, though, continued to be profitable overseas, posting a $582 million profit in Europe and $388 million in South America. The company also made $50 million at its Asia-Pacific-Africa division.
"The second half will continue to be challenging, but we have absolutely the right plan to respond to the changing business environment and begin to grow again for the long term," President and CEO Alan Mulally said in a statement.
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Bush is by far the worst president this country has ever known.
Nah. We have Carter and Clinton tied for that spot. Bush is just barely ahead of them, though...
Is there anyone here who did not see the demise of the SUV a long time ago when gas prices shot through the roof? Why couldn''t the auto makers???
What you dunces have to remember is, the automobile manufacturers have to build vehicles that people will buy, not some enviromentalist''s idea of what the proper vehicle should be.
Bush is by far the worst president this country has ever known.
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Then why were you blaming Reagan?
Yes, I know, we Republicans all look alike to you...
Posted by OneWorldUSA at 06:36 PM : Jul 24, 2008
Indeed it could have. Instead it was higher priced than most any car in its class. A co-worker of mine bought one for his wife new in 2005 and is still well satisfied with it.
-If they could build a car equally as reliable as an import, they''''d be cooking.
I''ll agree up to a point. In the mid 80''s Detroit was still building a 4 or 5 year car. Quality has improved drastically since then. It had to... otherwise there would be no GM, Ford or Chrysler now.
These days I think its more a question of the owner willing to do the vehicle maintainence than of build quality. Neglected autos won''t last long no matter who made them.
Second Quarter Earnings Fall Short Of Expectations.
That isn''t a loss, it''s poor "projection''s" on their part. Loopholes just let them to write it off as a loss. More good new''s today though; the DOW took a good dump!
If they could build a car equally as reliable as an import, they''d be cooking.
Posted by txgrouch2006 at 04:01 PM : Jul 24, 2008
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Bush is by far the worst president this country has ever known. He is the where ultimate responsibility rests. Therefore all national problems and many international problems are due to his actions--or lack of reactions. He''s simply not a competent leader!
Had a toyota pick up try to push me at a stop light.. he was first in line I was second.. he had pulled to far out in the intersection.. and didn''''t go.. he wanted to back up so he pushed on me. I pushed back.. and he was in the middle of the road when the smoke cleared.. FOOL!!!!
I also had a co worker talk smack with his Chevy.. I offered to hook up and have a pull off.. but the chevy owner got scared and ran away like a little girl.. typical Chevy owner..
put up or shut up..
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Posted by MeanBiker at 03:00 PM : Jul 24, 2008
Have fun spending $120 to fill up...
YEEHAW!!!!!!!
BUILT FORD TOUGH!!! I SURE HOPE YOUR WALLET IS TOO!!