Ford posts $8.67 billion loss for second quarter
Worst quarterly results in history of company
DEARBORN, Mich. – Ford Motor Co. posted the worst quarterly performance in its history Thursday, losing $8.67 billion in the second quarter.
The company also said it will retool two more North American truck and sport utility vehicle plants to build small, fuel-efficient vehicles, and it announced plans to bring six new small vehicles to North America from Europe by the end of 2012.
The net loss includes $8.03 billion worth of write-offs because the sharp decline in U.S. truck and SUV sales has reduced the value of Ford’s North American truck plants and Ford Motor Credit Co.’s lease portfolio. Even excluding those 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.
Including the write-downs, Ford lost $3.88 per share in the April-June quarter, compared with net profit of $750 million, or 31 cents per share, in the same quarter a year ago.
The second-quarter loss surpassed Ford’s previous record quarterly loss, $6.7 billion in the first quarter of 1992.
Second-quarter revenue was $38.6 billion, down $5.6 billion from the year-ago period. Analysts expected $34.6 billion.
Ford has been successful selling cars in Europe, and the company is banking on the new European models to boost sales and revenue as it deals with a market shift from trucks to cars brought on by high gasoline prices.
The company said it has sufficient liquidity to weather the latest downturn in the U.S. auto market without additional borrowing. Ford borrowed $23.4 billion in 2006 to fund its North American turnaround.
“We are pleased that we went to the capital markets at the right time,” Ford President and CEO Alan Mulally said in a conference call with investors and media. “We have the scale, the expertise and the financing to execute our plan.”
The company 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, which makes Ford Super Duty pickups.
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.
The company had previously announced it would retool its pickup truck factory in Cuautitlan, Mexico, to build the Fiesta subcompact for North America starting in 2010.