Ford first-quarter profit beats Wall St view, more confident of stronger ’19
By Nick Carey and Paul Lienert
DETROIT (Reuters) – Ford Motor Co on Thursday posted a better-than-expected first-quarter as pickup truck sales remained strong in its core U.S. market and the company expressed greater confidence in its forecast that 2019 would bring better results than last year.
The news sent Ford shares up 1.6 percent in after-market trading.
Ford has launched a long restructuring of its business that will include cutting costs by $11 billion by 2021 and overhauling its product lineup.
Chief Financial Officer Bob Shanks told reporters at company headquarters in suburban Detroit that Ford has more confidence that its 2019 results will be better than last year’s, but said it is in a “volatile environment with very strong competition.”
Shanks added that the first quarter was likely Ford’s best for the year.
Virtually all of the No. 2 U.S. automaker’s profit was generated in the U.S. market, thanks to a strong performance by its best-selling F-Series pickup trucks and its new Ranger midsize pickup truck. The company lost money in most other markets, but less than it had expected.
Ford also made a small profit in Europe and the profit at its financing arm also grew.
“We still have lots and lots of work to do,” Shanks said. “It’s the beginning of the game, it’s not game over.”
Ford’s biggest challenges lie outside the United States. The automaker is struggling in China. Earlier this month, Ford said it plans to launch more than 30 new models in China over the next three years, as it seeks to reverse a two-year sales slump in the world’s top auto market.
The automaker saw its sales fall 48 percent in the quarter, but said higher-priced products helped deliver a smaller loss than in the same quarter in 2018.
In March, Volkswagen AG and Ford signed a deal to develop mid-size pickup trucks and are continuing discussions about extending the alliance to include electric and autonomous vehicles and mobility services.
The two automakers have yet to reach agreement on a potential VW investment in Ford’s Argo AI self-driving unit.
CFO Shanks said those talks were “going very well.”
On Wednesday, Ford said it will invest $500 million (387.8 million pounds) in U.S. electric vehicle startup Rivian Automotive LLC, joining e-commerce giant Amazon Inc in backing the potential rival to Silicon Valley’s Tesla Inc.
Ford posted a quarterly net profit of $1.15 billion or 29 cents per share, down 34 percent from $1.74 billion or 43 cents per share a year earlier. Excluding one-time items, Ford earned 44 cents per share, above analyst estimates of 27 cents, according to IBES data from Refinitiv.
Ford reported revenue of $40.3 billion for the quarter, down 4 percent from $42 billion a year earlier.
(Reporting by Nick Carey; Editing by Tom Brown)