and Keith Naughton
Ford Motor Co., the second-largest U.S. automaker, said Tuesday it expects to lose about $2 billion in Europe this year as a likely recession in the region continues to sap demand for cars.
Ford Europe lost $732 million in the fourth quarter and $1.75 billion in the region for the full year, more than its previous forecast given in October of about $1.5 billion. The deficit will be worse in 2013 than Ford’s previous projection for a similar loss to a year earlier because a Europe-wide recession is likely this year, Chief Financial Officer Bob Shanks said.
“We’re seeing weakness in the industry; certainly it will be lower than last year,” Shanks said during a briefing at Ford’s headquarters in Dearborn, Mich. “It’s just a very tough economic environment in Europe. We have a lot of difficult times in front of us.”
Ford also said fourth-quarter sales and profit exceeded estimates. Excluding one-time items, the per-share profit was 31 cents, exceeding the 25-cent average estimate of 19 analysts surveyed by Bloomberg.
Ford reported net income of $1.6 billion, or 40 cents a share. The result compared with net income of $13.6 billion, or $3.40 a share, a year earlier, when a tax gain boosted fourth-quarter earnings.
Rising demand for F-Series trucks in Ford’s home market paced a record $8.34 billion annual pretax profit for the company’s operations in North America, which countered overseas losses. That included a fourth-quarter pretax profit of $1.87 billion.
Ford reported net income of $5.67 billion for the full year. The profit in 2012 boosts the company’s earnings to $35.2 billion the past four years after losing $30.1 billion from 2006 through 2008.
Total company profit will be about the same in 2013 as a year earlier, with a higher profit for North America and an operating margin of about 10 percent in the region, Shanks said.
Ford will pay profit sharing of about $8,300 on average to its 45,300 hourly workers.