Ford: Outlook for 2nd quarter upgraded
Ford’s second-quarter outlook is improving, with large numbers of customers making reservations for four of its new vehicles.
Ford Motor Co. now anticipates its quarterly adjusted earnings before interest and taxes for the April through June quarter to top its expectations and be significantly better than the year-ago period.
Although there’s still uncertainty around semiconductor supply, Ford is seeing improvement in its automotive business due to lower-than-expected costs and favorable market factors. It’s also being helped by increased vehicle auction values.
CEO Jim Farley told investors at Deutsche Bank’s Global Auto Industry Conference on Thursday that the company is benefiting from lower costs overseas and in North America due to restructuring. It’s also seeing “pretty breathtaking” prices for its vehicles with tight inventories, and higher revenue from its credit arm, he said.
But he said Ford is still being hit harder than competitors by the global shortage of computer chips because it was more reliant on Renesas, a Japanese chip maker that had a fire at one of its factories in March. Even though the Renesas plant is restarting some production, he doesn’t see Ford returning to normal vehicle availability until sometime next year due in part to high demand. “I would say in the second half of the year, things are going to get better for us,” Farley said. “We are learning that this is a scramble to get the (computer) modules in the vehicles in the second half, even.”
Also, unlike competitors, Ford will not remove features such as fuel-saving stop-start technology in order to keep building vehicles with fewer chips, Farley said.
