Tag Archive | "Ford Motor Co."

Ford Posts Q1 Results; Shows Highest North American Profit Since 2000

Dearborn, Mich. – Ford Motor Co. reported first quarter 2013 pre-tax profit of $2.1 billion, driven by record results from North America and continued solid performance from Ford Credit. Total company first quarter pre-tax profit of $2.1 billion, or 41 cents per share, was $147 million lower than a year ago, more than explained by Europe and South America. Net income for the first quarter of $1.6 billion, or 40 cents per share, was $215 million higher than a year ago.

Ford generated positive Automotive operating-related cash flow of $700 million in the first quarter — the 12th consecutive quarter of positive performance — with strong liquidity of $34.5 billion unchanged from year-end 2012. As part of Ford’s previously announced strategy to de-risk its pension obligations, the company made $1.8 billion in cash contributions to its worldwide funded plans during the quarter. This included $1.2 billion of discretionary contributions, in line with Ford’s long-term pension de-risking strategy.

Dividends paid in the quarter totaled about $400 million.

“Our strong first quarter results provide further proof that our One Ford plan continues to deliver,” said Alan Mulally, president and CEO. “Our plan remains centered on serving customers in all markets around the world with a full family of vehicles — small, medium and large; cars, utilities and trucks — each with the very best quality, fuel efficiency, safety, smart design and value.”

For the first quarter of 2013, Ford’s wholesale volume and revenue were each about 10 percent higher than a year ago, driven primarily by strong performance in North America and Asia Pacific Africa. The decrease in total Automotive pre-tax profit and operating margin for the first quarter is explained by Europe and South America.

North American Results
Ford North America experienced strong growth in the first quarter, with wholesale volume up 17 percent from the same period a year ago, and revenue improving 20 percent. Ford North America’s pre-tax profit, which was a record for any quarter since at least 2000 when the company began reflecting the region as a separate business unit, increased from the same period a year ago due to favorable market factors, offset partially by higher costs that reflect the company’s investment in new products and growth, as well as higher pension and OPEB expense. These same factors drove Ford North America’s operating margin of 11 percent — the fourth quarter out of the last five that the region produced double-digit operating margins.

For full year 2013, Ford’s guidance for North America remains unchanged — the company expects strong performance to continue, with pre-tax profit expected to be higher than 2012 and operating margin of about 10 percent. The first quarter loss of $125 million reflects net interest expense, offset partially by a favorable fair market value adjustment on the company’s equity investment in Mazda.

Ford expects net interest expense for full year 2013 to be about $750 million to $800 million, in line with the first quarter run rate of about $200 million. Consistent with prior guidance, the company expects its full year operating effective tax rate to be similar to 2012, which was 32 percent.

Ford remains focused on delivering the key aspects of the One Ford plan, which are unchanged:
• Aggressively restructuring to operate profitably at the current demand and changing model mix
• Accelerating the development of new products that customers want and value
• Financing the plan and improving the balance sheet
• Working together effectively as one team, leveraging Ford’s global assets

The company continues to work toward its mid-decade outlook.

“We continue to expect 2013 to be another strong year, as we go further in strengthening our global product lineup and improving the competitiveness of our operations,” Mulally said. “Everyone at Ford remains laser focused on continuing to make progress on our One Ford plan and building a profitably growing Ford for the benefit of all our stakeholders.”

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GM, Ford to jointly develop 10-speed transmissions

Via USA Today

The latest auto race isn’t on a track. It’s under the car, unseen, in the transmission.

Ford Motor and General Motors, the two biggest of the Detroit 3, said today they will jointly develop nine- and 10-speed automatic transmissions, which could save fuel and improve performance, particularly with smaller engines. Developing a new transmission is a complex and expensive project — joint development could save each company hundreds of millions of dollars.

The automakers say their engineers already are at work, but don’t say when to expect the gearboxes, which will share parts.

Companies legally can develop hardware together as long as they part ways to manufacture and tune it, as GM and Ford say they will. Unaffiliated companies even have shared engines. Chrysler, Hyundai and Mitsubishi jointly developed engines that they all used from 2005 to 2009.

The gear-speed battles seem a bit like the race to field the most cup holders or the most LED lights. But packing as many ratios as possible into a vehicle’s transmission case is about much more than bragging points.

Done correctly, a transmission with more speeds improves mileage, performance or both by allowing the engine to work more efficiently. How well a transmission works, however, depends not just on the number of gears but on the software programming that controls it.

Chrysler Group is putting the first mainstream nine-speed automatics into the Dodge Dart and coming 2014 Jeep Cherokee this year. And while seven- and eight-speed transmissions are common among luxury brands, Chrysler is a pioneer at the moment for using eight-speed boxes in its mainstream big cars and, this year, Ram pickups.

It wasn’t long ago that six-speed automatics were the new thing. In fact, Ford and GM collaborated on shared six-speeds last decade. While both GM and Ford are trumpeting that as an example of their joint success, those six-speeds got off to a rocky start.

GM used them in its big crossover SUVs, such as the Chevrolet Traverse and GMC Acadia. But it had to have dealers reprogram the gearbox control software several times the first year because of complaints about poor shifting.

Ford used its version in the Edge crossover SUV, among other models, but then-partner Mazda declined to accept the box for its adaptation of the Edge, called CX-9.

To boost fuel economy, a many-speed gearbox can have several “overdrive” gears, which let the engine run very slowly even though the car is speeding down the highway. For maximum performance, a gearbox with more gears can be set up to try to always keep the engine revolutions at or near the spot where it makes the most power. The art is to get the best of both approaches and to do so without annoying pauses or jerks, whether shifting up or down.

Some car companies, such as Honda, Nissan and Subaru, are going a different route with automatics called CVTs (continuously variable-ratio automatic transmissions). They have a belt-drive configuration that uses variable-diameter pulleys to constantly adjust the ratio for what their designers believe is the correct setting for the situation.

Some drivers don’t care for CVTs’ gearless driving feel, however, so automakers program in modes that either mimic the feel of conventional multispeed automatics or let drivers manually pick from six or seven ratios.

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Law Firm Suing Ford Over Possible F-150 Defect

New Orleans — Consumer-rights law firm Hagens Berman filed a proposed class-action lawsuit against Ford Motor Co., alleging that the company’s Ford F-150 trucks contain a dangerous safety defect that causes the vehicles to shake violently, shudder and stall when attempting to accelerate.

The 36-page complaint, filed in the U.S. District Court for the Eastern District of Louisiana, quotes more than 20 F-150 owners who claim that their vehicles suffered from the defect, which attorneys believe is caused by a flaw in Ford’s Charge Air Cooler (CAC) system. The complaint alleges that the system, which is designed to cool air before it reaches the engine, causes condensation to build up inside the air intake tube, especially in more humid climates.

Attorneys said they believe that moisture moves into the engine when drivers accelerate, causing the vehicle to shudder. In severe cases, the F-150’s computer system senses the danger and forces the vehicle into “limp mode” to prevent damage, the complaint alleges.

“This is a significant defect, and one that involves a life-safety issue,” said Steve Berman, managing partner of Hagens Berman and attorney for the proposed class. “Before we began our investigation, we reviewed the reports of many owners who told us harrowing stories of narrowly avoiding what could have been fatal crashes when their F150 stalled while attempting to pass or change lanes in busy freeway traffic.”

The suit claims that Ford is completely aware of the issue, and has gone as far as to warn dealers in a secret memo, noting that vehicles may “stumble and/or misfire on hard acceleration after an extended drive at highway speeds during high humid or damp conditions.”

Steve Berman currently serves as co-lead counsel for the economic loss class in the sudden, unintended acceleration lawsuit brought against Toyota. That case has resulted in a proposed settlement valued at up to $1.4 billion, the largest automotive defect settlement in history.

The lawsuit against Ford seeks to provide compensation to all current or former owners and/or lessees of model-year 2011-2012 Ford F-150 vehicles.

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Ford Motor Co. Names New COO, Mulally to Remain CEO Through at Least 2014

Dearborn, Mich. – Ford Motor Co. is further strengthening and developing its leadership team while continuing to deliver the One Ford plan for profitable growth. Alan Mulally plans to continue to serve as Ford president and CEO through at least 2014. At the same time, Mark Fields was named the company’s new chief operating officer, effective Dec. 1.

Mulally will continue leading the long-term strategic development of the One Ford plan and its continuous improvement. Fields will be responsible for all business operations. Fields will continue to report to Mulally, as will the company’s chief financial officer, general counsel and group vice president of Human Resources and Corporate Services.

Ford’s automotive business units – The Americas (including both North America and South America); Europe, Middle East and Africa; and Asia Pacific – will report to Fields. Also reporting to Fields will be most of the company’s functional skill teams, including Product Development; Manufacturing and Labor Affairs; Purchasing; Quality; Sustainability, Environment and Safety Engineering; Information Technology; Government and Community Relations; Marketing, Sales and Service; and Communications.

The company also made several other concurrent leadership announcements, also effective Dec. 1, including:

• Joe Hinrichs was named executive vice president and president of The Americas; Hinrichs is currently group vice president and president of Asia Pacific Africa
• Stephen Odell was named executive vice president and president of Europe, Middle East and Africa; Odell is currently group vice president, chairman and CEO, Ford of Europe; Africa is being realigned with Europe and the Middle East under Odell to take advantage of profitable growth opportunities and efficiencies
• Jim Farley was named executive vice president of Global Marketing, Sales and Service and Lincoln; Farley, who is currently a group vice president, adds operating responsibility as the senior global leader for Lincoln, working together with the company’s business units and functions on the re-invention of Lincoln as a world-class, global luxury brand
• David Schoch was named group vice president and president of Asia Pacific; Schoch is currently chairman and CEO, Ford of China
• John Lawler was elected a Ford Motor Co. vice president and named chairman and CEO of Ford Motor China; Lawler is currently CFO, Ford Asia Pacific Africa

“Today marks an important next step in the profitable growth of the Ford Motor Company and the appointment of key leaders who will help us continue to make progress on our One Ford plan,” Bill Ford said. “The strength of our people and stability of our team are competitive advantages for Ford. We are fortunate to have Alan’s continued leadership as well as talented senior leaders throughout our company who are developing and working together and delivering on our plan.”

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Auto Industry Sees Strong September Sales

This week, all of the major manufacturers in the auto industry released their sales numbers for September. And across the board, the news is very good. Across the board were reports of increased vehicle sales, not just over last year’s numbers but in many cases the best numbers these companies have seen since in the last decade. Here are just a few of the highlights:

Ford Motor Co., for example, reported that overall, it’s small car sales were up 73 percent year-over-year to 24,628 units, the best numbers it has had since 2002. The company’s F-Series trucks continued a 14-year consecutive growth streak, with an increase of one percent over last year to sell 55,077 units. “As more buyers look for new vehicles across the country, Ford is ready with our strongest lineup ever of fuel-efficient cars, utilities and full-size pickups,” said Ken Czubay, Ford vice president, U.S. Marketing, Sales and Service. “Fuel economy remains one of the most important features customers want most today, and Ford is answering the call with five vehicles that deliver 40 mpg or better – with another three on the way by year-end.”

Toyota was another winner, with sales results of 171,910 units, an increase of 41.5 percent compared to the same period last year on both a daily selling rate (DSR) and a raw volume basis. The Toyota Division posted September total sales of 151,524 units, an increase of 42.3 percent on a DSR basis from September 2011. The Lexus Division reported total sales of 20,386 units in September 2012, up 36.0 percent from September 2011 on both a DSR and raw volume basis compared to the same period last year. “The auto industry had another very encouraging month in September,” said Bill Fay, Toyota group vice president and general manager. “Our dealers got off to a great start over Labor Day weekend and that momentum carried through the rest of the month, as Camry continued to stretch its lead as the most popular car in America.”

Hyundai Motor America wrapped up the quarter setting multiple sales records, including 60,025 sales for the month of September. Sales were up 15 percent for the month, and up 10 percent for the first nine months of the year versus 2011. The Azera and the Elantra families saw sales gains of 1028 percent and 27 percent, respectively, over last September. The Tucson saw sales gains of 23 percent over the same period a year ago, and Veloster, the three-door coupe, had a sales gain of 262 percent. Hyundai fleet sales and mix remained low at a nine percent mix for the month and year-to-date, among the lowest in the industry. “September was a very encouraging month for Hyundai as we avoided the traditional back-to-school sales decline and began to reap the benefits of a materially improved inventory situation on our core vehicle lines,” said Dave Zuchowski, executive vice president of sales. “We’re well positioned for a strong fourth quarter as sales of the newly launched Elantra GT, Elantra Coupe, the all-new Azera and all-new Santa Fe continued at a brisk pace. Our fourth quarter production plan is up nearly 20 percent on a year-over-year basis.”

The BMW Group in the U.S. (BMW and MINI combined) reported September sales of 26,660 vehicles, an increase of 3.5 percent from the 25,749 vehicles sold in the same month a year ago. Year-to-date, BMW Group is up 7.1 percent on sales of 234,928 in the first nine months of 2012 compared to 219,314 in the same period in 2011. “The economic indicators and consumer confidence are showing improvement and the traffic in our showrooms is further encouraging our optimism for the fourth quarter of the year as the BMW new model ramp-up continues,” said Ludwig Willisch, President and CEO, BMW of North America, LLC. “The X1 in its first full month is largely sold out and MINI set another sales record; both are strong indicators of what’s to come.”

Mercedes-Benz USA reported record sales of 23,156 for its Mercedes-Benz models, up 7 percent, delivering a record year-to-date total of 191,618 new vehicles to customers, up 12.7 percent. Combined sales of Mercedes-Benz passenger vehicles, smart and Sprinter for the month totaled 25,980, up 8.7 percent, bringing the year-to-date total to 214,331 up 16.7 percent. “We’re on our way to a record year with extraordinary momentum and demand outpacing supply,” stated Steve Cannon, president and CEO, MBUSA.

Kia Motors America (KMA) achieved a record third quarter and the 25th consecutive month of record sales, reaching 48,105 units, a 35.1 percent increase over the same period in 2011. The Optima midsize sedan sold 14,304 units and the Sorento CUV enjoyed sales of 10,066 vehicles. The Soul accounted for 9,467 units sold, bolstered by the recent launch of the “Bringing Down the House” advertising campaign featuring the music-loving Kia hamsters. “Kia’s product-led transformation – together with our successful marketing – have elevated Kia’s reputation beyond our bedrock commitment to value,” said Byung Mo Ahn, group president and CEO of KMA and KMMG. “At Kia, we work to understand the needs and expectations of our customers and work to find new ways to enrich their lives, providing the Kia brand with powerful potential as more new products and technologies are set to arrive in the next 12 months.”

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Ford Makes 350 Millionth Car, Focus Top Car Worldwide

DETROIT – Ford Motor Company celebrated the company’s 350 millionth vehicle – a Ford Focus, which is the world’s best-selling car for the first half of 2012.

Ford is celebrating the production milestone at its newest global manufacturing facility located in Rayong, Thailand, approximately 120 miles southeast of Bangkok. Ford Thailand Manufacturing (FTM) plant is a $450 million facility, opened in May to produce the new Focus, which also is built in four other countries. FTM represents the latest in Ford’s global manufacturing capabilities, with new stamping presses, flexible body shops and robotic capabilities that enable it to produce up to six different vehicles simultaneously.

“Producing 350 million vehicles is equivalent to producing one vehicle every 10 seconds for our 109-year history. If placed end to end, the vehicles would stretch to the moon and back – twice,” said John Fleming, Ford executive vice president of global manufacturing. “Producing this vehicle in Thailand also is significant. It underscores the power of our One Ford plan to deliver profitable growth with great products built in ultra-flexible and efficient facilities everywhere around the world.”

In addition to the manufacturing milestone, for the first six months of this year, Focus became the best-selling single car nameplate in the world, based on global data from IHS Automotive. According to IHS Automotive, the Ford Focus sold 489,616 units in the first half of this year. The nearest competitor, Toyota Corolla, sold 462,187.

“Embracing its performance, value, versatility and fuel economy, the Focus is attracting many new customers to the Ford brand for the very first time, particularly in Asia where we are growing every day,” said Jim Farley, Ford’s group vice president for global marketing, sales and service. “The Focus is a winner on so many levels because it successfully provides customers with what they want most – a safe, smart, fuel-efficient, good-looking, fun-to-drive, affordable car.”

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