Ford posts solid Q3 profits as light truck sales offset decline in car deliveries
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Ford also reported quarterly earnings and revenue that beat analysts' expectations. Strong sales of trucks in North America helped offset declining sales of passenger cars, and challenges such as higher costs, lower volume, and difficulties in China.
However, the Dearborn automaker posted a third-quarter net income of US$ 1 billion, down 37.5% from the US$ 1.6 billion in the same period of 2017. Excluding items, Ford earned 29% per share, beating the 28% per share expected by analysts.
Total revenues increased nearly 3% to US$ 37.6 billion, while its automotive revenue was US$ 34.7 billion, above the US$ 33.3 billion analysts forecasted.
The second-largest U.S. automaker continues to benefit from a relentless consumer shift toward SUVs and trucks in North America, Ford's strongest market. Ford said its F-Series pickup line gained market share, and the Super Duty line of trucks saw record high transaction prices.
The results come during a challenging time for the automaker, which is very much in the middle of a turnaround. Also, materials costs have risen and tariffs have already cost the company at least US$ 1 billion.
“This quarter shows that our business remains very strong in key areas. We continue to make progress on our efforts to redesign Ford to be far more competitively fit, disciplined in capital allocations and nimble enough to win in a fast changing world,” said Jim Hackett, Ford president and CEO during the earnings conference call.
Ford owns an assembly facility in Hermosillo, Sonora which builds Ford and Lincoln sedans, although several reports have pointed out that the plant will shift towards production of crossovers in the near future.
Another plant located in Cuautitlan Izcalli, State of Mexico builds the Ford Fiesta in sedan and hatchback versions. However, production of the Fiesta is also slated to end in 2019 for the facility to be retooled to build electric vehicles.
Ford also operates an engine manufacturing complex in the city of Chihuahua which comprises of three plants and a transmissions production facility in the city of Irapuato, Guanajuato.