Ford Credit, Ford Motor Report Strong 1Q Earnings
Ford Motor Company and its finance arm, Ford Motor Credit Company, reported first-quarter profits today, but company executives remained cautious about the auto industry’s overall recovery.
DEARBORN, Mich. — Ford Motor Company and its finance arm, Ford Motor Credit Company, reported first-quarter profits today, but company executives remained cautious about the auto industry’s overall recovery.
Ford Motor Company posted first quarter 2010 net income of $2.1 billion, a $3.5 billion improvement from first quarter 2009, as higher profits at Ford Credit, strong selling new products and improvements in its global automotive operations boosted profits.
Ford’s first quarter revenue was $28.1 billion, up $3.7 billion from the same period a year ago.
Ford North America posted first quarter pre-tax operating profit of more than $1.2 billion, a $1.9 billion improvement from first quarter 2009, which the company attributed to higher volume and mix and favorable net pricing.
“We remain cautiously optimistic about positive signs emerging in the global economy, while knowing that the recovery is fragile and the global auto industry continues to deal with excess capacity. For us, the most important thing we can do is to stay focused and continue to make progress on our plan,” Mulally said.
Part of the company’s plan involves the positive performance by Ford Credit. The company said it expects the finance arm’s 2010 profits to be about the same as 2009.
Ford Motor Credit Company reported net income of $528 million in the first quarter of 2010, an improvement of $541 million from a net loss of $13 million a year earlier.
On a pre-tax basis, Ford Credit earned $828 million in the first quarter, compared with a loss of $36 million in the previous year. The improvement in pre-tax earnings primarily reflected lower depreciation expense for leased vehicles due to higher auction values and a lower provision for credit losses, offset partially by lower volume.
“Ford Credit had strong first quarter results, in part due to improvements in the used vehicle auction markets,” said Mike Bannister, chairman and CEO of Ford Credit. “Economic conditions are still uncertain and, as always, we will utilize the solid business practices and superior servicing that remain the foundations of our company.”
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