• 2020 Ford Explorer ST
  • Exterior
  • Image Credit: James Riswick
  • 2020 Ford Explorer ST
  • Exterior
  • Image Credit: James Riswick
  • 2020 Ford Explorer ST
  • Exterior
  • Image Credit: James Riswick
  • 2020 Ford Explorer ST
  • Exterior
  • Image Credit: James Riswick
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • Shown with 8-inch screen, not available on production ST. It comes standard with the 10.1-inch screen.
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • Shown with 8-inch screen, not available on production ST. It comes standard with the 10.1-inch screen.
  • Image Credit: Autoblog
  • 2020 Ford Explorer Platinum
  • 10.1-touchscreen
  • Image Credit: Autoblog
  • 2020 Ford Explorer
  • Interior
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer Platinum
  • Interior
  • Image Credit: Autoblog
  • 2020 Ford Explorer Platinum
  • Interior
  • Image Credit: Autoblog
  • 2020 Ford Explorer Platinum
  • Interior
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer ST
  • 2020 Ford Explorer ST
  • Image Credit: Autoblog
  • 2020 Ford Explorer
  • Interior
  • Image Credit: Autoblog
  • 2020 Ford Explorer
  • Interior
  • Image Credit: Autoblog
  • 2020 Ford Explorer
  • Interior
  • Image Credit: Autoblog
  • 2020 Ford Explorer
  • Interior
  • Image Credit: Autoblog
  • 2020 Ford Explorer
  • Interior
  • Image Credit: Autoblog
  • 2020 Ford Explorer
  • Interior
  • Image Credit: Autoblog
  • 2020 Ford Explorer
  • Interior
  • Image Credit: Autoblog

DETROIT — Ford Motor Co.'s profit last year plunged by more than $3.6 billion, weighed down by slowing U.S. sales, the cost of a botched SUV launch and some big pension expenses.

The Dearborn, Michigan, automaker said it made $47 million in 2019, down from a $3.68 billion profit a year earlier. For the fourth quarter the company lost $1.7 billion, or 42 cents per share, hit by $2.2 billion in one-time pension costs.

Excluding one-time items, Ford made 12 cents per share for the quarter, falling short of Wall Street's expectations. Analysts polled by FactSet predicted 17 cents per share.

Quarterly revenue fell 5% to $39.7 billion, about even with Wall Street estimates.

Shares of Ford fell nearly 8% on Wednesday. Analysts criticized the company's management for holding back details on the earnings shortfall.

Ford forecast 2020 adjusted earnings before interest and taxes (EBIT) between $5.6 billion and $6.6 billion, largely below at the midpoint, compared with $6.4 billion in 2019.

The disappointing outlook also underscores the higher costs that Ford has been spending on developing self-driving and electric cars to keep pace with pioneers like Tesla Inc

"It's not clear to us exactly what is driving the profit lower. ...The lack of transparency is not likely to sit well with investors or inspire confidence," RBC Capital Markets analyst Joseph Spak said, lowering target price on the stock to $9 from $10.

Ford also warned of lower profits at its credit arm and higher warranty costs, but did not provide details.

"Management declined to quantify the impact of the higher warranty, making it difficult to gauge at the moment how much or when costs should normalize lower," said J.P. Morgan analyst Ryan Brinkman, cutting price target by a $1 to $9.

"The 2020 guidance makes it hard for us to see why investors should get excited about owning Ford stock now," Morningstar analyst David Whiston wrote in a note.

"The results were not OK in 2019," Ford Chief Financial Officer Tim Stone told reporters at the company's headquarters outside Detroit.

"As I look to 2020 and beyond, I'm very optimistic," he said, while cautioning that Ford's lower guidance does not yet account for the potential impact of the coronavirus outbreak in China.

In an after-hours call with financial analysts, Chief Executive Jim Hackett was more blunt about the challenge of balancing Ford's protracted turnaround efforts with its continuing work on future technology, including electric and self-driving cars.

"I don't think this company can keep straddling the old and new worlds forever ... This company has to change," Hackett said.

Hackett blamed the drop primarily on the flubbed launch of the new Ford Explorer SUV at its factory in Chicago.

New Explorers came off the assembly line with multiple problems and had to be shipped to a Detroit-area factory for repairs.

Hackett also referred to higher warranty costs during the year, especially for a flawed six-speed automatic transmission in the Ford Focus compact car.

He said the Explorer production is now fixed and the SUVs are selling well.

“Our leadership team is determined to return to world class levels of operational execution,” he said.

He said 2019 was a year of restructuring for the company as it downsized its white-collar workforce and shifted its products to higher-growth, higher-margin SUV and truck segments while exiting lower-growth sedans.

The company also announced that blue-collar workers represented by the United Auto Workers union will get profit-sharing checks of $6,600, based on North American pretax profits of just over $6.6 billion.

Material from Reuters was used in this report.

 

Ford Explorer Information

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