Ford Motor said it lost $526 million in the final three months of 2023, primarily as a result of special charges related to its employee pension programs and the reorganization of some of its overseas operations.
The automaker said its fourth-quarter revenue rose to $46 billion, from $44 billion a year earlier, thanks to strong sales of internal combustion vehicles and light commercial trucks.
The company's division that makes gasoline and hybrid vehicles earned $813 million before interest and taxes in the fourth quarter, and its commercial vehicles division earned $1.8 billion. The unit that makes electric vehicles lost $1.6 billion.
John Lawler, Ford's chief financial officer, said the company's fourth-quarter earnings were also hit by a prolonged strike by the United Automobile Workers union and higher labor costs stemming from the new contract it signed with the UAW.
“Adjusting for those two factors, you're looking at a pretty strong quarter,” Lawler said on a conference call.
Ford had previously said the strike reduced its pretax profits by $1.7 billion in 2023.
Looking ahead, Ford said it expected to make between $10 billion and $12 billion in adjusted earnings before taxes and interest this year.
Speaking to financial analysts, Ford CEO Jim Farley said the company was adjusting its investments in electric cars, putting less emphasis on larger vehicles and more on smaller models that will use a low-cost design in which Ford has been working.
A small electric vehicle from Ford will most likely compete with a more affordable car that Tesla is expected to introduce in 2025. “The final competition will be affordable Tesla and Chinese manufacturers,” Farley said.
Ford reported a profit of $4.3 billion in 2023, compared with a loss of $2 billion in 2022. Revenue in 2023 rose to $176 billion, up from $158 billion in 2022. The company said Its 58,000 UAW workers would receive profit-sharing bonuses of up to $10,400 based on their performance in 2023.
The automaker said it wanted to improve its financial performance by investing less in some areas, such as electric vehicles, while setting higher profit targets for projects it was still pouring money into. “Simply 'good' is not enough and investments are going down. to projects that have credible plans to achieve anticipated returns,” Lawler said in a statement.
Ford shares rose about 6 percent in extended trading after it reported earnings.
