THE UNCERTAIN nature of the recovery in the global car market was underlined yesterday as Ford posted a dip in third-quarter profit.
America’s number two car-maker also cut its profit margin forecast for this year after racking up losses in Europe and Asia.
It said it had been hit by slowing growth in China and price pressure in Europe and did not say when it expected to pay its first dividend since it slid into crisis in 2006. Lewis Booth, chief financial officer, said only that it would be “sooner rather than later.”
Revenue rose 14 per cent to $33.1bn (£20.73bn) but profit fell two per cent to $1.65bn. The group also cut its 2011 outlook for its margin on automotive profit, saying it now expects 5.7 per cent, down from 6.5 per cent through the first three quarters. It had previously said it would at least match its 2010 level of 6.1 per cent.
The group posted a pre-tax profit of $1.55bn in America as auto sales steadied over the summer but swung to a pre-tax operating loss of $43m in Asia and Africa, compared with a $30m profit last year. European losses shot up 56 per cent to $306m as price competition hit margins.
The quarter included a non-cash charge of about $350m to write down the value of hedges Ford had taken to offset the risk of raw material costs increasing, when they actually fell.
JP Morgan called the results “so-so” and Citi said they were “a bit messier than expected”.