Overall, Ford posted net income of $2.3 billion for the second quarter, versus a net loss of $8.7 billion in the year-ago quarter.
Both quarters included large one-time items. For instance, the quarter just ended included one-time gains totaling $2.8 billion, mostly related to debt reduction for Ford and Ford Credit. Without the one-time gain, Ford's turnaround would have been less impressive, but by the same token without one-time losses in the year-ago quarter, the year-ago quarter would not have looked so bad.
A key number to watch is that Ford cut the pre-tax loss in its North American automotive operations to $851 million, versus a pre-tax loss of $1.3 billion a year ago. That means Ford is cutting costs and gaining market share faster than revenues are shrinking, due to lower overall demand.
The other good news was that consumer-credit metrics improved across the board for Ford Credit, including fewer repossessions, and lower losses per repossession; fewer delinquencies and lower credit losses. Auction values for cars and trucks coming back off of leases also improved. Falling auction values hurt Ford and Ford Credit in the year-ago quarter.
Ford Credit had net income of $413 million in the second quarter, versus a net loss of $1.4 billion in the year-ago quarter. Ford Credit's results are added directly into results for the parent company.
To be sure, the improved credit metrics are a self-fulfilling prophecy to some extent, because Ford can improve its own metrics by being more choosy about making new loans, and by cutting back on leasing. Still, the numbers are more encouraging than they have been.
Chart: Ford Credit