Ford in the red with £213m losses
Ford fell into the red as losses in its key North American division increased and sales of high-margin sport utility vehicles dropped.
The world’s third largest automaker, which is facing a deepening financial crisis, reported its third quarter results yesterday.
It announced a $377m (£213m) pre-tax loss compared to a $718m (£406m) profit the previous year on a 4.4 per cent rise in sales to $40.9bn (£23.1bn).
Chairman and chief executive Bill Ford said: “As our results indicate, we face many challenges in this competitive and difficult environment. We have demonstrated throughout the year that we will continue to take the actions necessary to return our core business to sustainable profitability.”
Ford’s loss is the first since the fourth quarter of 2003, and follows a continual decline in its market share in America. Its North American automotive operation made a pre-tax loss of $1.1bn, a decline of $648m compared to last year. Sales of Ford vehicles in that region are down by 1.3 per cent this year despite a well-publicised discount programme.
Pre-tax loss in Europe was $163m, an improvement of $41m on last year.
Chief financial officer Don Leclair said: “We expect the fourth quarter to be another extremely competitive period. We will continue the turnaround in our operations in Europe, the investment growth in Asia, and to address our issues in America.”
But pressure is building on Ford to reveal its plan for cutting costs and capacity in its North American division. Ford has said it will announce a restructuring plan this autumn and has not ruled out deeper job cuts in its salaried work force and the closing of manufacturing plants.
