GM Inside News Forum banner

Ford earnings strong; N. America profit record set

3K views 31 replies 22 participants last post by  jpd80 
#1 ·
http://www.detroitnews.com/story/bu...rd-announce-second-quarter-earnings/30771271/

Dearborn — Despite continued low supply of its most profitable pickup, Ford Motor Co. is riding a wave of high-priced vehicles and low incentives to record profits in North America and an “outstanding” second quarter across the globe. And it expects to do even better in the second half of the year.

The Dearborn automaker on Tuesday reported stronger-than-expected earnings of $1.9 billion, up 44 percent from the same period a year ago, marking its best automotive quarterly profit since 2000, and third best since the Great Recession. Ford was driven by a record quarterly profit of $2.6 billion in North America, up $157 million from a year ago. It posted an operating margin of 11.1 percent.

“We delivered an outstanding second quarter, a great first half of 2015, and we are confident the second half of the year will be even stronger,” President and CEO Mark Fields said in a statement.

Ford’s pre-tax profit was $2.9 billion, up $269 million from a year ago, and it posted revenue of $37.3 billion, beating analysts estimates of about $35.3 billion. Ford posted earnings-per-share of 47 cents per share, beating analysts estimates by a dime.

Through the first half of the year, Ford made $4.3 billion in profits and achieved 9.1 percent profit margins. For the second-straight quarter, Ford posted no special items or one-time charges.
 
  • Like
Reactions: 'Vette Dude
#2 ·
For comparison:

Ford
Revenue- $37.3B
Net Income- $1.89B
Market Cap-
Vehicles Sold June 2015 (US) - 220,704

GM
Revenue- $38.2B
Net Income- $1.1B
Market Cap-
Vehicles Sold June 2015 (US) - 259,353

What is going on here?
 
#19 ·
GM is bigger global, sold much more vehicles, Ford sold 1.7 million vehicles world wide

But GM has also been shoring its cash balance sheet and making a lot of non cash adjustments to income (special items) to pay for all sorts of problems they see coming.

The key to know GM's health is its net adjusted free cash flow

Adjusted automotive free cash flow $3.3 billion, and that is after fully funding their planned investments in North America China and Europe.

GM's Automotive net cash flow from operating activities was $5.1 Billion.

GM is fine, after they get through their special items period, profitability will be better.

Remember too GM has no Finance company to speak off anymore, unlike Ford. They let GMAC go.
 
#3 ·
the F150 supply "issue" IMHO is doing FORD GOOD in that it is reducing fleet purchases more then retail + I assume a percentage of retail buyers are taking what is on offer and NOT getting the exact truck they want as the times are long I assume for Factory order which is beneficial if FORD and the dealers are keeping expensive models around
 
#10 ·
Bull*hit.

"Fiat has a much higher percentage of lower-paid, entry-level workers than General Motors GM.N and Ford Motor Co F.N, according to a study of 2014 labor costs by the Center for Automotive Research. Fiat's U.S. worker costs averaged $48 per hour compared with $57 for Ford and $58 for GM last year."

http://ca.reuters.com/article/businessNews/idCAKCN0PN0FW20150713

Any other facts you want to make up to help your GM bash?
 
#13 ·
GM has significantly more projects in development (platforms, engines, transmissions, materials, PHEV etc.), so I'm not surprised. Besides, it should include a long-term investment in Cadillac, share buybacks, the transition from the old to the new platforms.
 
#28 ·
Investments are reflected in cash flows, not the income statement. GM's income statement is weak because they are run by weak managers. Share buybacks also are not included in income statements (that's in the balance sheet and cash flow statement). Also GM should not be buying back shares, but that's a lost cause when Mary Barra can be whipped around by activists at will.
 
#31 ·
How much overhead goes in to running these different divisions and then consolidating to produce GM figures? Surely this would account for many dollars. How many brands does Ford have -two that I can think of - Ford and Lincoln. GM has Chev, GMC, Buick and Cadillac domestically and then the foreign ones Opel, Vauxhal, Holden. I guess both have JVs in China though.
 
#32 · (Edited)
Comparing North American results...

Sales:
GM 965K
Ford 816K

Revenue:
GM: $26.5 Billion
Ford: $23.3 Billion

EBIT:
GM: $2.8 Billion (10.5%)
Ford: $2.6 Billion (11.1%)


So basically,
GM's Nth American Earnings Before Interest and taxes was $200 Million more than Ford Nth America
but in order to achieve that, GM had to sell 149,000 more vehicles than Ford Nth America.

Hmm, that leads to average transaction price for Ford being a little higher closing the deficit:
GMNA $26.5 Billion divided by 965,000 sales = ~$27,461 per sale (Average only)
FNA $23.3 Billion divided by 816,000 sales = ~$28,533 per sale (Average only)

Not picking a fight here, just simply showing how slightly higher Average Transaction Prices
are allowing Ford to stay in touch with GM's Nth American financial result with much lower sales.
Let's hope this puts the misconception of Ford and "low profit fleet sales" to bed...

Two quotes from Autonews regarding Ford's performance in Nth America:

And, most notably, it managed that gain without any additional help from the redesigned F-150, which didn’t reach full production until early June. Lower sales volumes and costs related to launching the truck offset the benefits of higher transaction prices in the quarter, executives said.

“F-series did not positively contribute to the bottom line in the second quarter because it was still in launch phase,” CFO Bob Shanks said on a conference call with analysts and reporters.
Ford said its North American pretax profit of $2.6 billion was helped by $526 million from higher prices and a $219 million reduction in incentive spending.

“We were kind of getting the best of both worlds at the same time,” Shanks told reporters at Ford headquarters.


All interesting stuff, well done to both companies..
 
This is an older thread, you may not receive a response, and could be reviving an old thread. Please consider creating a new thread.
Top