Ford’s first quarter operating profit drops $544 million to $2.3 billion

Article by Anita Panait, on April 27, 2012

Ford Motor Co. logged a $544 million drop in pre-tax operating profit for the first quarter of 2012 to $2.3 billion, as it was hurt by losses at its European and Asian operations. The company also posted a $700 million decline in global revenues to $32.4 billion, and a $1.2 billion dive in net income to $1.4 billion.It should be noted that half of the decline in net profit was particularly due to higher tax expenses and special charges.

The company’s global performance was eventually saved by its North American operations, which posted an operating profit of $2.1 billion in the first three months of 2012 compared to $1.8 billion in the same period in 2011. Ford’s quarterly profit in North America in 2012 was the highest ever since the company started to report the region as a separate business unit in 2000.

What hurt Ford’s results the most in the first quarter of 2012 was the $149 million operating loss at its European operations, which posted a $293 million in profit for the same period in 2011. The company pointed the blame to lesser industry volumes as well as reduced demand for auto parts and accessories.

The company’s Asia-Pacific-Africa unit bled as well, posting a $95 million in operating losses in the first three months of 2012, a sharp contrast to $33 million in profit for the same period in 2011. Ford attributed the loss to higher cost related to its investments in new production in the region. The company also attributed the loss to slower-than-expected rollout of the global Ranger pickup from its Thai and South African sites.

The company’s South American operations suffered as well, but managed to post $54 million in pre tax profit for the first quarter of 2012, down from $210 million for the same period in 2011. Ford Motor Credit Co., posted $452 million in first quarter 2012 pre-tax operating profit,  compared to $713 million in 2011.  The company ascribed the loss at its lending unit to fewer lease terminations. Ford chief executive Alan Mulally commended the company’s strong performance in the first quarter of 2012 despite having to cope with a challenging global external environment.

The new Ford Ranger debuted globally at the 2010 Australian International Motor Show. This Ranger’s strong presence promises pickup truck owners more go-getting ability, transforming the experience of owning a truck.

With remarkable safety and power improvements and incredible towing capabilities, this new Ford Ranger is clearly leading the segment. Building on the Ranger’s amazing pickup truck legacy, it offers a roomy, comfortable, interior chock full of features and an enjoyable drive normally only expected from a car.

One of the most advanced pickups, the Ranger’s impressiveness begins from Ford’s brand new compact pickup truck platform from its One Ford initiative and Mazda. Replacing the two prior compact truck platforms in production, this presents a new Built Ford Tough look to customers globally.

Founded on inventiveness, the Ranger leads with its features and technologies, including a new rear view camera system, rear parking assistance, trailer sway controls, and adaptive load control. Ford will unveil more new Ranger advances in the next months.

To be sold in five continents and over 180 markets, the Rangers will, depending on the market, offer a full compact truck family, with three cab body styles, two ride heights, 4x2 and 4x4 drivetrains and up to five series choices.

Ford used its vast experience with trucks in creating the new Ford Ranger. The company focused its worldwide resources on a new compact pickup truck so that it could deliver valuable and substantial advances, features, and technologies, as well as remarkable fuel economy that would, by itself, be enough of a reason to buy it.

Topics: ford, profit

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