- Ford beat expectations on both the top- and bottom lines.
- Shares moved up 5% after-hours.
Ford reported third-quarter earnings on Wednesday, posting beats of analysts’ expectations on both revenue and profits.
The carmaker made $US0.29 per share and brought in $US37.6 billion.
Ford shares spiked 5%, to nearly $US9, in after-hours trading. Year-to-date, Ford has been in a severe slide, down over 30%.
“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,” CEO Jim Hackett said in a statement.
In an interview with Business Insider after earnings were released, Ford CFO Bob Shanks said that company’s 8.8% profit in it’s all-important North America was an improvement from 7.6% in the first half of 2018. “We’d like it to be 10% or higher,” he said.
Shanks also said that the carmaker’s troubled China market had cut losses by about $US100 million for the quarter. Ford will break China out from its current Asia Pacific region for reporting purposes, putting it on the same level with North America, going forward.
“There’s a lot of new product coming to China,” Shanks said. “It’s the beginning of an onslaught.”
For the quarter, Ford saw lower sales volumes but higher transaction prices, a trend that Shanks said could continue as consumers switch from passenger cars to crossover and SUVs. He also said that the company expects total sales for the US market to end 2018 at around the same near-record levels at 2017 – below 17.5 million, but above 17 million.
Ford has been affected negatively by Trump administration tariffs, but Shanks said that Ford will be dealing with them until the situation changes. He noted that the administration has yet included steel and aluminium in the newly proposed trade agreement between the US, Canada, and Mexico.
If the issue is resolved, Shanks said, “that could take a lot of the air out of the bubble that’s been created” in raw materials.
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