VW and Toyota (NYSE: TM) have competition from a US car company again–Ford.

Ford Motor Company (NYSE: F) Q net income of $1.7 billion, $.43 cents per share, a $690 million improvement from third quarter 2009. Excluding special items, Ford reported a pre-tax operating profit of $2.1 billion, or $.48 cents per share, an improvement of $1.1 billion from a year ago. Ford has posted pre-tax operating profits for five consecutive quarters.Ford’s third quarter revenue was $29 billion, a decline of $1.3 billion from the same period a year ago. Excluding Volvo revenue from 2009, Ford’s revenue in the third quarter was up $1.7 billion compared with the same period a year ago.

The company showed improvement but only in the US.Ford North America posted a third quarter pre-tax operating profit of $1.6 billion, a $1.3 billion improvement from third quarter 2009. It is safe to argue that the US is Ford’s most difficult market because of the drop from 16 million vehicles sold nationwide in 2006 to barely 11 million this year.

The domestic figures were essential to profits.

For the third quarter, Ford South America reported a pre-tax operating profit of $241 million, compared with a profit of $247 million a year ago. Commodities costs hurt results
For the third quarter, Ford Europe reported a pre-tax operating loss of $196 million, compared with a profit of $131 million a year ago. The year-over-year decline primarily reflects lower industry volume and market share and higher costs, including structural costs to support product launch and engineering spending and higher commodity costs. Third quarter revenue was $6.2 billion, down from $7.3 billion a year ago.
For the third quarter, Ford Asia Pacific Africa reported a pre-tax operating profit of $30 million, compared with a profit of $22 million a year ago. The year-over-year increase is explained primarily by higher industry volume and material cost reductions, offset partially by higher structural costs to support investment in Ford’s product and growth plans and market mix shifts from mature to emerging markets. Third quarter revenue was $1.8 billion, up from $1.5 billion a year ago

Looking forward, Ford expects to build upon its performance this year with continued improvement in 2011 in total Company profitability and Automotive operating-related cash flow. This includes improvement in its Automotive operations, driven primarily by growing product strength with new vehicles, continued productivity improvements and the gradually strengthening global economy.
In addition, Ford expects each of its Automotive operations to be profitable in 2011. Ford also expects solid profitability for Ford Credit in 2011, although at a lower level than 2010, reflecting primarily the non-recurrence of lower lease depreciation expense and non-recurrence of credit loss reserve reductions of the same magnitude as 2010.
Global industry volume for 2011 is expected to grow from the 2010 level.

GM is still not a threat to other large global car companies because its products have not evolved enough to compete with most new models from its peers. Ford, on the other hand, has had several successful product launches under the Ford brand. Lincoln continues to struggle.

But, Ford has now improved its balance sheet and earnings enough that it has become on of the global Big Three.

Douglas A. mcIntyre

 

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