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Dearborn — Ford Motor Co. is putting some of the factors that led to a 54 percent third quarter profit drop — recall costs, lower product volume and economic troubles overseas — in its rear view mirror as it looks to greater profits through the rest of this year and into 2015.

On Friday, Ford reported a third quarter pre-tax profit of $1.2 billion, down $1.4 billion from the same period last year, due in large part to one-time recall costs and low volumes thanks to plant downtime and inventory management surrounding a record 23 new product launches.

And while economic and political issues that have hurt growth in South America and Europe will likely persist, Ford expects its new cars and trucks should lead it to better results next quarter and next year.

"Some (issues) won't repeat, some things will still be with us," CFO Bob Shanks said in an interview. "The good news is that our new product will give us the ability to take the results to a higher level."

But an optimistic outlook comes after Ford has taken some short-term hits.

All of Ford's third quarter automotive pre-tax results were lower than a year ago, except for in its Middle East and Africa region.

The Dearborn automaker posted third quarter earnings per share of 24 cents, down from 45 cents per share during the same period a year ago. Third quarter revenue was $34.9 billion, down from $35.8 billion a year ago, as Ford suffered its first negative cash flow — $700 million — since 2010.

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"It's not a pause in our sales growth; it's a pit stop," President and CEO Mark Fields said on a conference call with analysts and media. "Clearly, there's a lot of things going on in the world. We expect this to be a growth industry, and we're a growth company in that industry."

Already, the tone could be changing.

Fields said Ford has completed 12 of its 23 product launches and is "absolutely on plan" with the highly anticipated launch of its new aluminum-bodied F-150 pickup. A successful launch later this year could help reverse an 8 percent third quarter North American volume drop, attributed largely to the month-long shuttering of the Dearborn Truck Plant and controlled inventory of 2014 model year trucks.

"With major launch costs expected to be largely past, we expect numerous new product launches, including the new all-aluminum F-150 pickup truck, to help drive solid sales and profitability growth in 2015," Efraim Levy, an analyst at S&P Capital IQ, said in a statement.

Analysts say the advances in the new truck will be revolutionary.

"Ford has spent the last few years pursuing a long-term philosophy around platform design and engine technology," Karl Brauer, KBB.com senior analyst, said in a statement. "This philosophy centers on both lightweight materials and small-displacement engines, both of which we're seeing in the automaker's recent Mustang and F-150 launches. ... These same material and drivetrain innovations will pay dividends across the rest of Ford's model line over the next decade, despite their near-term impact on profits."

Ford made a $1.4 billion North America pre-tax profit in the third quarter, down from $2.3 billion a year ago, which it attributes to lower volume and about $630 million in recall costs that it doesn't expect will be a factor next quarter. Last month, Ford announced that a recall of a restraint control module would cost it $500 million.

"We still feel the business in North America is operating at an extremely high level," Shanks said.

Ford's U.S. market share was 14.1 percent, down 0.8 percentage points, thanks to a planned decline in daily rental sales.

South American volume — down 21 percent in the third quarter — should also increase as the year ends, as Ford just launched a new Ka and F-series trucks there. It also launched a number of new vehicles in Europe, as well as its Lincoln brand in China, where it saw a record 4.7 percent third quarter market share.

Ford lost $170 million in South America during the third quarter, and lost $439 million in Europe.

Ford expects to lose $1 billion in South America this year and another $1.2 billion in Europe, mostly due to geopolitical problems in Russia. The automaker forecasts a $250 million loss in Europe in 2015, after previously predicting to turn a profit there next year.

"We're disappointed we're not going to hit that target, but we believe we'll have a substantial improvement next year," Shanks said.

Ford lost $15 million in its Middle East and Africa region this quarter, and made $44 million in Asia Pacific, thanks to strong performance in China.

"The third quarter was challenging," Fields said. "But we remain absolutely focused on implementing our plan."

mmartinez@detroitnews.com

(313) 222-2401

Twitter.com/MikeMartinez_DN

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