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Ford has surprise: profit near $1 billion
Market-share gains and cost cuts helped
AP Photo
Ford headquarters in Dearborn, Mich. Ford said that the Cash for Clunkers program increased sales.
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Published: November 3, 2009
DEARBORN, Mich. - Ford, the only Detroit automaker to dodge direct government aid and bankruptcy court, surprised investors with net income of nearly $1 billion in the third quarter and forecast a "solidly profitable" 2011.
Ford said yesterday that earnings were fed by U.S. market-share gains, cost cuts and the Cash for Clunkers program, which drew flocks of buyers to showrooms this summer. Ford's shares rose 68 cents, or 9.8 percent, to $7.68 in morning trading.
The latest results indicate that Ford's turnaround is on more solid ground. The company lost more than $14.6 billion last year and hasn't posted a full-year profit since 2005. Though it made a profit in the second quarter, that was mainly due to debt reductions that cut its interest payments.
Ford, based in Dearborn, Mich., reported third-quarter net income of $997 million, or 29 cents a share. Its profit forecast for 2011 was a step above previous guidance of break-even or better for the year.
Ford's key North American car and truck division posted a pretax profit of $357 million, the division's first quarter in the black since early 2005. Ford cited higher pricing, lower material costs and increased market share for the improvement.
Excluding one-time items, Ford earned 26 cents a share, blowing away analysts' expectations of a loss of 12 cents.
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