Ford doubles net income in Q1, new record

Apr 28, 2016, 11:57 AM EDT
(Source: Hayley Robinson/flickr)
(Source: Hayley Robinson/flickr)

Ford doubled its net income in Q1, reaching a new record on the back of truck sales worldwide.

The Wall Street Journal writes:

Ford Motor Co. reaped the benefits of its costly F-150 truck revamp, doubling net income in the first quarter and posting a North American operating margin rivaling those returned by high-end luxury brands. The Dearborn, Mich., company is among a field of auto makers benefiting from record U.S. light-vehicle demand and low gasoline prices, a trend fueling sales of the most profitable units on dealer lots. As sales of trucks and SUVs soar, Ford is enjoying a disproportionate advantage over its Detroit rivals due to product redesigns rolled out since Chief Executive Mark Fields took over in mid-2014. Ford is also gaining steam in China, making nearly a half-billion dollars in a market where it traditionally has been far behind General Motors Co. and other global heavyweights. That momentum, combined with an abrupt reversal of fortunes in Europe, is more than offsetting weakness in South America, Russia and other emerging markets.

CNBC notes:

Ford CEO Mark Fields said the company would continue to deliver great results, noting that Ford reaffirmed guidance that puts the automaker on track to perform as well as, or better than, it did last year. "Hopefully, at some point, the market will recognize us for that, but we're going to keep focusing on the fundamentals of the business," he told CNBC's "Squawk Box." Demand for SUVs and trucks offset lower sales in South America. U.S. sales of the Ford Explorer SUV rose 39 percent in the first quarter. Ford is seeing a shift to SUVs not only in the United States, but around the world, according to Fields. He said Ford is well-positioned to take advantage of the trend. He noted, however, that Ford would invest $4.5 billion in electrified vehicles over the next four years with the goal of electrifying 40 percent of its autos by the end of the decade.

Reuters writes:

Ford beat GM in both revenue and profit in the quarter, mainly because of stronger results in North America and Europe. Ford's quarterly revenue of $37.7 billion edged past GM’s $37.3 billion. GM last week reported a first-quarter net income of $2 billion, while Ford's net income was $2.5 billion. Ford reported $3.08 billion in pretax profit for North America, outpacing GM’s $2.3 billion for the quarter. In Europe, Ford earned a pretax quarterly profit of $434 million, while GM broke even. The company's global operating margin was 9.8 percent, while global pretax profit was a record $3.8 billion in the quarter. Ford more than doubled profit in the Asia-Pacific region to $220 million, from $105 million a year ago. But it lost money outside of its China joint ventures. The company's equity income from its joint ventures in China was $443 million, up from $360 million, for a quarterly operating profit margin of 16.4 percent.