Ford Motor Company is an American multinational vehicle manufacturer headquartered in Dearborn, Michigan, United States. It is also known as Ford. Henry Ford founded the company, and it was incorporated on 16th June 1903. The Ford brand sells trucks and cars, while the Lincoln luxury brand sells luxury vehicles. Ford also owns Troller, a Brazilian SUV manufacturer. It also holds a 32% stake in China’s Jiangling Motors and an 8% stake in UK’s Aston Martin.
In addition, the Ford Company has joint ventures in Thailand (AutoAlliance Thailand), Russia (Ford Sellers), Taiwan (Ford Lio Ho), Turkey (Ford Otosan), and China (Changan Ford). The Ford family controls the company, and it is listed on New York Stock Exchange. They have majority voting power but minority ownership.
Ford Motor Company is the second-largest US-based automobile manufacturer (behind General Motors). It is also the fifth-largest company globally (behind Volkswagen, Toyota, General Motors, and Hyundai) based on 2015 vehicle production. It was Europe’s fifth-biggest automaker at the end of 2010.
The Ford Company was the eleventh-ranked American-based firm in the 2018 Fortune 500 list. Ford manufactured 5.532 million automobiles in 2008 and employed approximately 213,000 employees working at 90 plants and facilities across the globe. Its global revenues for 2017 were $156.7 billion.
Ford Motor Company announced first-quarter earnings on Wednesday that met Wall Street’s estimations. However, Rivian Automotive’s stake in electric vehicles affected its net profit, and lower vehicle production drove down its net profit.
Ford Company announced a $3.1 billion unadjusted net loss, including a $5.4 billion loss on its 12% stake in Rivian Automotive. A year before, the company had a net profit of $3.3 billion in the same period.
Rivian shares lost nearly 52% of its market capitalization during the first quarter, reducing Ford’s holding from $10.6 billion to $5.1 billion.
The Ford Motor Company declined to say on the earnings call when or if the company plan to exit Rivian after a lock-up period for pre-Initial Public Offering (IPO) investors expires on 8th May 2022. Rivian Automotive’s stock has dropped approximately 60% since its IPO on 9th November, 2021.
During the call on Wednesday, John Lawler, Chief Financial Officer, Ford Company, stated that “We are not going to comment anything on Rivian.”
Ford Company confirmed its pretax adjusted earnings estimate for the year between $11.5 billion to $12.5 billion despite increased costs and supply chain issues during the quarter.
Ford’s stock surged around 2% during extended-hours trading to nearly $15.10 per share. The stock closed at $14.85 per share, up almost 1%.
Here’s how Ford performed compared to what Wall Street expected.
- Automotive revenue: According to Refinitiv consensus anticipates, the automotive revenue is $32.1 billion vs. 31.13 billion.
- Adjusted EPS (Earnings per Share): According to Refinitiv consensus anticipates, the earnings per share is 38 cents vs. 37 cents.
Ford’s first-quarter results were “mixed,” according to John Lawler, who cited supply chain issues and an adjusted pretax profit of $2.3 billion, which was lower than the $3.9 billion it recorded a year ago, even subtracting the Rivian hit.
John Lawler further stated that the business could keep its guidance because of strong car pricing and expectations for production to improve during the year. He reiterated that the automobile manufacturer anticipates wholesale volumes, which are correlated with production, to rise by 10% to 15% compared with 2021.
Ford’s wholesale volumes fell 9% to 966,000 units in the first quarter of this year, compared to the same period last year.
Ford’s North American operations earned $1.6 billion for the quarter. This is a substantial decline from the $2.9billion it made in the same market last year. Its European operations made a pretax profit of $207 million, compared to $341 million a previous year. The company’s China operations have incurred more significant losses, which increased to $53 million from $15 million a year ago.
Ford’s stock is down around 30% this year due to various issues. In 2021, it was the top-performing automaker stock in terms of growth.
Ford Motor’s first-quarter results were announced a day after its crosstown competitor, GM (General Motors Company), significantly outperformed Wall Street’s earnings estimations. The General Motors Company also stunned analysts by keeping its adjusted pretax profit target for 2022 at $13 billion to $15 billion, despite a slew of supply chain difficulties and increased costs.