Visitor walk past a Ford Escape Titanium at the Shanghai Auto Show in Shanghai on April 17, 2019.
Greg Baker| AFP | Getty Images
DETROIT – Ford Motor plans to invest $29 billion in electric and autonomous vehicles through 2025, the company announced Thursday when it reported better-than-expected fourth-quarter earnings.
Here’s how Ford did compared with what Wall Street expected based on average estimates compiled by Refinitiv.
- Adjusted EPS: 34 cents versus an expected loss of 7 cents
- Revenue: $33.2 billion versus $33.89 billion, expected
Ford CFO John Lawler said the company is forecasting it will earn between $8 billion and $9 billion in adjusted pre-tax profits and generate between $3.5 billion and $4.5 billion in adjusted free cash flow in 2021. That doesn’t factor in a global shortage in semiconductor chips that he said could lower Ford’s earnings by $1.0 billion to $2.5 billion this year.
“The semiconductor situation is changing constantly, so it’s premature to try to size what
availability will mean for our full-year performance,” he said in a press release. “Right now, estimates from suppliers could suggest losing 10% to 20% of our planned first-quarter production.”
Lawler in October projected that the automaker’s adjusted pretax earnings for the fourth quarter would fall somewhere between a $500 million loss or break even. That would be down from a $485 million profit during the fourth quarter of 2019.
On an unadjusted basis, the company’s loss widened to $2.79 billion, or a loss of 70 cents a share, during the fourth quarter from a loss of $1.67 billion, or a loss of 42 cents a share, during the same three months of 2019.
Lawler said the decline would largely be due to costs related to new or redesigned vehicles the company launched toward the end of the year. That included the 2021 F-150 pickup truck as well as the Bronco Sport SUV and Mustang Mach-E all-electric crossover.
Analysts and investors are expected to look past the loss and focus on Ford’s guidance for 2021. Despite a faster-than-anticipated recovery from the pandemic last year, the industry now faces a shortage of semiconductor chips that’s causing automakers to cut vehicle production.
Ford confirmed plans Thursday to cut shifts next week at plants in Michigan and Missouri that produce its profitable F-150 pickup trucks due to the chip shortage.
Wall Street also is watching for any additional business changes by Ford CEO Jim Farley, who replaced Jim Hackett effective Oct. 1, and any updates on the company’s electric vehicle plans.
