Ford Motor Company expects its pretax profit this year to dip to $9 billion, as the automaker continues to invest in mobility services, autonomous-vehicle tech, and more. Ford also faces the possibility of losses in Europe due to fallout from the UK’s “Brexit” vote.
The company’s pretax profit for 2016 was $10.4 billion, nearly matching its record $10.8-billion haul in 2015.
Ford Executive VP and Chief Financial Officer Bob Shanks says the company is still a good investment, despite the anticipated decline in profit for 2017 and reduced expected per-share earnings of 30 to 35 cents for the first quarter. “We’re a strong global enterprise, we’ve weathered and we have thrived over the last seven years,” he said on a call with investors last Thursday. “We do expect the business to improve in 2018… driven by improvements in core business.”
Mr. Shanks went on to say that Ford can strengthen its portfolio in the truck, van, SUV, and performance segments to bolster profitability over time, while its growing emphasis on electrification, autonomy, and mobility services will lead to new revenue. He conceded that the automaker will need to evolve in response to any new policy changes under US President Donald Trump, which could involve tax reforms, new infrastructure demands, or a complete renegotiation of NAFTA.
But evolution is nothing new for Ford.
“We’ve been transforming this business pretty dramatically all the way back since 2005,” said the CFO. “We are working on different business models, we’re looking at collaborations, we’re looking at traditional restructurings, we’re looking at rethinking the construct of the business… Everything is on the table, and it should be.”
(Source: The Detroit News)