Automaker Ford weakens profit outlook amid price war, shares fall
Ford Motor said on Monday it expects to hit the lower end of its full-year profit guidance, dropping the company's shares 5% in after-hours trading, as a price war hits the U.S. automaker's bottom line.
- Ford expects $10 billion EBIT this year, down from $10 billion-$12 billion range
- Third-quarter profit fell less than expected
Ford faces $5-billion loss on EVs this year despite cost improvements
Ford expects to earn about $10 billion in earnings before interest and taxes this year, down from its prior range of $10 billion to $12 billion.
"No doubt, there's a global price war, and it's fueled by over-capacity, a flood of new EV nameplates and massive compliance pressure," CEO Jim Farley said on a call with analysts.
Ford has also been weighed down this year by high warranty costs and problems with its supply chain, worsened by recent hurricanes, Chief Financial Officer John Lawler said.
Third-quarter profit fell less than expected, however.
The company reported third-quarter net income of $900 million, or 22 cents per share, down from 30 cents a year ago. Results were hurt by a $1-billion charge it took on cancelling production of a three-row electric SUV in August.
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