Ford lost $3.1 billion in the first quarter

Ford Motor said on Wednesday it lost $3.1 billion in the first three months of the year due to a sharp decline in the stock price of Riv...

Ford Motor said on Wednesday it lost $3.1 billion in the first three months of the year due to a sharp decline in the stock price of Rivianan electric vehicle start-up that Ford took a stake. Ford has also been hit by slowing sales resulting from an ongoing shortage of computer chips.

Excluding its stock decline in Rivian, Ford said it earned $2.3 billion before interest and taxes, down from $3.9 billion a year earlier. Its net profit in the first quarter of 2021 was $3.3 billion.

Ford chief financial officer John Lawler said the company is seeing strong demand for its sport utility vehicles and pickup trucks, but it can’t produce enough of them. “We didn’t have enough chips to build the vehicles customers wanted, and we couldn’t take full advantage of our manufacturing capacity,” he said on a conference call.

Ford said its first-quarter revenue fell to $34.5 billion from $36.2 billion a year earlier. The company sold 966,000 vehicles in the first quarter, up from 1.1 million a year ago. Higher new vehicle prices helped Ford and other automakers offset some of the impact of lower sales.

The company’s performance contrasted with that of two major competitors. On Tuesday, General Motors announced a profit of $2.9 billion for the first quarterand last week, Tesla said it made $3.3 billion.

Lawler said Ford was taking steps to increase its semiconductor supply and expected its production rate to improve during the year. It is also counting on rapid growth in sales of electric vehicles. The automaker, which recently started producing an electric version of its F-150 pickup truckaims to manufacture 600,000 electric cars and trucks per year by the end of 2023.

Ford said its outlook for 2022 was unchanged and it expects annual profit of $11.5 billion to $12.5 billion before taxes and certain other expenses. Earlier this year, he predicted he would see “significantly higher profits in North America” ​​in 2022 and that global sales would decline slightly in the first quarter but increase 10-15% for the full year. .

Ford invested $500 million in Rivian in 2019, and the startup’s shares rose sharply after an initial public offering last fall. Its stock was trading at around $100 at the end of 2021, but has fallen to around $31 as Rivian struggled to ramp up production of an electric pickup truck, electric SUV and delivery van. for Amazon.

To reflect this drop in Rivian’s share price, Ford took a non-cash charge from its earnings, Lawler said.

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Newsrust - US Top News: Ford lost $3.1 billion in the first quarter
Ford lost $3.1 billion in the first quarter
Newsrust - US Top News
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