In response to the quarterly figures, the company’s share price fell significantly.
(Photo: AP)
Ford fell short of its own forecasts in terms of earnings last year. The operating profit amounted to 10.4 billion dollars, said the second largest US carmaker based in Dearborn on Thursday evening. The company itself had predicted 11.5 billion.
“We should have done much better last year,” said CEO Jim Farley. The group left “about two billion dollars in profit on the table”. Fourth-quarter revenue rose to $44 billion from $37.7 billion in the same period last year. Net income fell to $1.3 billion from $12.3 billion. Ford shares initially fell more than seven percent.
In response to Tesla’s massive price cuts, Ford has also cut prices. The number two US manufacturer cut prices for its Mustang Mach-E SUV by up to $5,900. The car manufacturer also attracts customers with favorable financing conditions.
Analysts expect a price war should the price cuts spread widely. Experts are reminded of the times more than ten years ago, when American car companies drove each other into a crisis with a ruinous discount battle.
The inspection of more than 1.8 million Ford Explorer vehicles initiated by the US National Highway Traffic Safety Administration (NHTSA) is likely to be associated with high costs. The agency said parts of the windshield trim could come loose at higher speeds on models built between 2011 and 2019.
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