Ford Motor Co’s half-year profit fell 14 percent from a year earlier to $3.163 billion as costs for warranties on vehicles for quality issues rose, the automaker said Wednesday.
In the second quarter, profit also fell year-on-year by 4.5% to US$1.831 billion.
For the first half of the year, revenue rose 4.8% to 90.585 billion dollars, of which 47.808 billion corresponded to the second quarter.
Ford attributed its drop in profitability to the increase in reserves to cover the rising cost of warranties on its vehicles, which have been experiencing quality problems.
Ford’s chief financial officer, John Lawler, however, noted in the earnings release that the company is improving the quality of its vehicles and that the results are already being seen.
Lawler cited a report from JD Power published in June, which indicated that the company had improved its quality rating in the US by 14 places, now occupying ninth position.
The company also detailed that Ford Blue, which produces vehicles with combustion engines, and Ford Pro, dedicated to commercial vehicles and services, increased sales in the second quarter by seven and nine percent, respectively, while those of Ford Model e, which develops and sells electric vehicles, fell by 37%.
In terms of results, Ford Blue made a profit of 1.171 billion dollars and Ford Pro 2.564 billion, while, on the contrary, Ford Model e lost 1.143 billion.
Source: www.jornaldenegocios.pt
