Tuesday, July 19, 2005

Profits down 19% at Ford

Automaker's core North American operations swing to $907M 2nd-quarter loss.

By Eric Mayne / The Detroit News

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Ford Motor Co., hurt by a wide loss in its core North American automotive business, posted a 19 percent drop in second-quarter profits. Net income dropped to $946 million, down from $1.2 billion a year ago, Ford reported today.

Revenues rose to $44.5 billion from $42.9 billion during the period.

In North America, Ford reported a pre-tax loss of $907 million, a swing of $1.4 billion from profits of $476 million in the same period in 2004. The automaker blamed the earnings decline on higher costs, production cuts and lower sales, which totaled $19.9 billion - $568 million less than a year ago.

The results in North America dragged down Ford's worldwide automotive operations, which recorded a pre-tax loss of $245 million - down from 2004's $97-million second-quarter profit.

"Despite profitability in most regions, our global automotive results were disappointing, reflecting the fiercely competitive environment in which we continue to operate," Ford Chairman and Chief Executive Officer Bill Ford said.

Ford has redoubled efforts to reduce costs in North America, including another round of salaried job cuts.