"Ford Motor Co. swung to a third-quarter loss because of a hefty charge associated with the shutdown of the auto maker's autonomous-driving venture Argo AI, the latest setback in the pursuit of self-driving cars.
The Dearborn, Mich., company, which invested in Pittsburgh-based Argo in 2017, said Wednesday that it is shifting its focus away from the development of fully autonomous driving technology and to partially automated features that Ford and other auto makers already offer. Ford will absorb several hundred of Argo's roughly 2,000 employees, the auto maker said.
Ford and Germany's Volkswagen AG each have about a 40% stake in Argo. VW separately said it is working with Argo to take on some of its workers and would pick up some of the firm's autonomous-driving work.
A spokesman for Argo couldn't be reached for comment.
The $2.7 billion write-off of Argo drove down Ford's third-quarter results, to a loss of $827 million, compared with a $1.8 billion profit from a year earlier. "It's become very clear that profitable, fully autonomous vehicles at scale are still a long way off," Ford finance chief John Lawler said during a call with reporters Wednesday.
Stripping out the loss on the Argo investment and other one-time factors, Ford posted a third-quarter pretax profit of $1.8 billion, down from $3 billion. Ford's bottom line amounted to 30 cents a share on an adjusted basis, beating analyst expectations of 27 cents per share, according to FactSet.
The auto maker said Wednesday that it will hit the low end of its projected full-year pretax profit guidance of between $11.5 billion and $12.5 billion.
Shares in Ford dropped about 1.3% in aftermarket trading. The auto maker's shares have fallen 38% since the start of the year.
The company's revenue increased 10% to $39.4 billion in the July-to-September period.
Car makers have been riding a two-year streak of strong profits, as a scarcity of new vehicles because of supply constraints has led consumers to snap up models at high prices. But investors are worried that rising interest rates and inflationary pressures are clouding the industry's outlook, analysts say, and have driven down shares of auto-sector stocks.
Auto executives say demand remains robust, and that many customers who have had difficulty finding a new vehicle are willing to look past higher rates.
"Customers are literally buying them as fast as we can make them," Mr. Lawler said.
Ford said in late September that $1 billion in unanticipated supplier costs would dent third-quarter earnings. The auto maker's stock price suffered its largest single-day percentage decline since 2011 following the notice and has remained beaten down." [1]
1. Business News: Ford Takes $2.7 Billion Charge on Argo Stake
Eckert, Nora.
Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]. 27 Oct 2022: B.3.
Komentarų nėra:
Rašyti komentarą