Asian sales helped fuel automaker’s quarterly growth
DEARBORN, MICH.—Ford Motor Co. has exceeded analysts’ expectations with $33.1-billion in revenues this quarter—its best first-quarter results in more than a dozen years.
Ford profits rose 22 per cent to $2.6 billion, marking the company’s eighth straight quarterly profit since near-bankruptcy five years ago.
The carmaker’s more fuel-efficient vehicles, which hit showrooms as gas prices surged, drove some of that growth.
Even larger vehicles performed well. Explorer SUV sales more than doubled and Fusion midsize sedan sales rose 27 per cent.
Ford is also charging more to offset higher commodity prices. The average price of a Ford vehicle increased by $260 in the first quarter, according to Edmunds.com, a car-buying site.
The company also got a sales boost from Asia, where revenues jumped 31 per cent to $2.1 billion.
Japan’s recent disaster cost Ford the production of 12,000 to 14,000 vehicles at its Asian operations, but the carmaker doesn’t expect those losses to affect the bottom line.
Ford now has $4.7 billion more cash than debt, an improvement of $3.3 billion from the start of this year.
But the road ahead may not be so smooth.
Prices for steel cost Ford $300 million in the first quarter, and could further increase costs by as much as $2 billion by the end of this year.
The company also lost some market share in the U.S., Europe and South America in the first quarter, partly because it didn’t match incentive spending by rivals such as General Motors Co.
The carmaker has also sold off Volvo and shut down Mercury.
Ford Chief Financial Officer Lewis Booth said the company will not produce more than it can sell.