Ford Motor Q2- Sales Drop -53%. Debt Grows $10B

Ken Zino of AutoInformed.com on Ford Motor Q2 2020 Loss Lowlights

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Ford Motor Company posted Q2 results that saw sales drop to 645,000 or -53%  because of COVID-related lower industry volume and suspended production through May 17. Adjusted Earnings Before Interest and Taxes was down -$1.9B, because of lower volume, new-model material cost and warranty, offset partially by higher net pricing, and lower structural cost arising from suspended production, reduced marketing activity and other one-time cost actions.

Analysts, a mysterious species to AutoInformed, were surprised and delighted? AutoInformed noted an ongoing warranty cost disaster, which is a management failure not a Covid issue. It remains troubling as Ford is introducing increasingly complex but profitable SUV, EVs and Trucks.

Here’s the Snapshot:

  • Q2 wholesale units down 53%, reflecting chiefly COVID-related lower industry volume and suspended production for most of the quarter.
  • Revenue at $19.4B dropped -50%, driven by lower volume and weaker currencies, offset partially by higher net pricing.
  • EBIT fell only -10% at -1.9B, despite a significant wholesale reduction; higher net pricing, cost performance and favorable vehicle mix more than offset inflationary cost increases.
  • The automotive results dropped in all regions – except for China and South America which broke even.
  • Ford made a gain of $3.5B in its Argo Autonomous vehicle subsidiary.
Ken Zino of AutoInformed.com on Ford Motor Q2 2020 Covid Losses

Better than expected?

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About Ken Zino

Ken Zino is an auto industry veteran with global experience in print, broadcast and electronic media. He has auto testing, marketing, public relations and communications expertise garnered while working in Asia, Europe and the U.S.
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2 Responses to Ford Motor Q2- Sales Drop -53%. Debt Grows $10B

  1. Based on responses collected July 9 through July 14, the Household Pulse Survey estimates that during the COVID-19 pandemic:

    51.1% of American adults live in households which have experienced a loss in employment income
    35.2% of American adults expect to experience a loss in employment income
    12.1% of Americans lived in households where there was either sometimes or often not enough to eat in the previous 7 days
    40.1% of adults had delayed getting medical care in the previous 4 weeks
    26.2% of respondents reported having little interest or pleasure in doing things more than half the days/nearly every day last week
    24.8% of respondents reported feeling down more than half the days/nearly every day last week
    33.9% of respondents reported feeling anxious or nervous more than half the days/nearly every day last week
    On average, households spent $211.34 a week to buy food at supermarkets, grocery stores, online, and other places to be prepared and eaten at home
    26.5% of adults either missed last month’s rent or mortgage payment, or had slight or no confidence that their household could make the next payment on time

  2. Pingback: Ford Motor Changes CEO from Jim Hackett to Jim Farley | AutoInformed

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