Ford reported smaller-than-expected quarterly losses, but restructuring is still ongoing

News

Ford reported smaller-than-expected quarterly losses, but restructuring is still ongoing

06.08.2020 News

Shares of Ford Motor Co dropped to 1.93% on Friday after the closing of trading on Thursday, automaker reported results of achievement in three months from April to June. Since the beginning of the year, Ford shares have fallen by 28.9%.

Ford Motor reported second-quarter losses of – $ 0.35 per share, which is better than analysts’ forecasts at – $ 1.17 loss per share, but significantly worse rate of $ 0.34 per share in the corresponding quarter last year.

Total quarterly revenue decreased from 50% to $ 19.4 billion, it is higher than Wall Street expectations of $ 15.95 billion.

In fact, in spite of the closure of Ford’s car plants in the early second quarter in many major markets, the company managed to reduce losses from the expected $ 5 billion to $ 1.9 billion.

In Europe, Ford production resumed at all plants by May 4. Most plants in North America returned to operation on May 18, and by the end of the quarter, production in the region had reached 95% of the pandemic level. Ford management said that all regions exceeded expectations.

In the third quarter, Ford expects to make a profit of $ 500 million to $ 1.5 billion, but at the same time, company forecasts a return to losses in the fourth quarter and for the whole year.

Ford’s weak fourth-quarter outlook largely reflects production problems and the cost of launching a new version of the lucrative full-size F-150 pickup for the 2,021 model year.

In its restructuring efforts, Ford also plans to release new Ford Bronco and Bronco Sport SUVs, which should appear in showrooms next year. Just a few weeks after the announcement of Bronco, the automaker received more than 150,000 pre-orders.

In addition to redesigning the cars, the company is working in a strategic “electrification” partnership with Volkswagen, Rivian and Mahindra to strengthen own global presence.

Ford is preparing to release the Mustang Mach-E electric SUV, just company pre-orders for the entire first year are only 50,000 units.

Analysts say the restructuring of Ford will take more time and money, that complicated by the decline in consumer demand in the pandemic time. Wall Street today expects that Ford supplies will recruit strong turnover by 2022.

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