In a notable financial turnaround, Ford Motor announced that it earned $1.9 billion in the second quarter of this year, a significant increase from $667 million in the same period last year. This positive growth can be attributed to robust sales of gasoline-powered trucks and sport-utility vehicles, which managed to offset the substantial loss incurred from electric models.
The automaker also reported a 12 percent increase in revenue, totaling $45 billion compared to the previous year, and revealed that it sold 1.1 million vehicles worldwide, marking an 8 percent rise in sales.
Unfortunately, Ford faced challenges in its electric vehicle business, reporting a loss of $1.1 billion before interest and taxes for the quarter, more than double the previous year’s losses. The intensifying competition in the electric vehicle segment forced the company to lower prices on its electric F-150 Lightning pickup truck and Mustang Mach-E crossover.
Looking ahead, Ford now anticipates a higher projected loss of $4.5 billion before interest and taxes on battery-powered cars and trucks in 2023, up from the earlier forecast of a $3 billion loss.
During a conference call, Ford’s chief financial officer, John Lawler, acknowledged that although the shift to electric vehicles is underway, adoption by early majority customers has proven to be slower than expected. The decline in prices across the industry, coupled with Ford’s production limitations, contributed to the challenges faced by the electric vehicle business.
In response, Ford has adjusted its electric vehicle rollout, now aiming to produce 600,000 electric cars and trucks annually by the end of 2024, instead of reaching that milestone by the end of this year as previously planned.
Fortunately, Ford’s losses in the electric car segment were offset by the profits generated from selling combustion engine vehicles. The division specializing in gasoline and hybrid vehicles for the consumer market earned $2.3 billion before interest and taxes in the second quarter, while the commercial customer-focused Ford unit reported a profit of $2.4 billion.
As a result, Ford has revised its overall profit forecast for 2023 to an estimated range of $11 billion to $12 billion, excluding interest, taxes, and certain expenses. This represents an upgrade from the previous forecast of $9 billion to $11 billion.
Following the announcement of its second-quarter results, Ford’s stock experienced a modest 1 percent increase in extended trading on Thursday.
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