Ford And Chrysler Set To Report 2nd Quarter Profits
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NOTE: Ford earnings come out at 7 AM. Chrysler earnings come out at 8 AM. Jeff Gilbert will be talking to analysts and executives. You can follow his Twitter feed (@jefferygilbert) here.
DEARBORN/AUBURN HILLS (WWJ) We get a look today at how some fast moving world events impacted the bottom lines of two of the three domestic auto companies.
Analysts expect Ford to post earnings of around $2.6 billion dollars for the second quarter. That’s slightly off the pace of it’s earnings report in both the first quarter of this year, and last year’s second quarter.
While Ford sales are up, and new products are doing well, the company is also facing higher costs for raw materials. Ford CEO Alan Mulally had warned that the $2.78 billion dollar first quarter profit would be the best showing of the year.
Ford has also said that it doesn’t expect an impact to the bottom line from the earthquake and tsunami in Japan, which forced it and other automakers to seek new sources of several important parts.
That natural disaster also impacted the availability of a number of Japanese products. But, Ford has said it doesn’t think it gained many customers because of that. The feeling, instead, was that those buyers were waiting for the Japanese products to become available.
Ford was able to keep a line on incentives in the second quarter, and that could give the profits a boost.
At Chrysler, it’s not about the total profit, as much as it is about growth.
This year’s first quarter was the first time that the new post-bankruptcy Chrysler posted positive earnings. It was still a fairly small $116 million dollars.
Analysts aren’t expecting a lot more, even though Chrysler sales are up 21 per cent over last year on the strength of new products.
This will also be the first time Chrysler’s earnings are incorporated into Fiat’s financial statement. It’s part of the closer integration of the two companies. Eventually, they will be totally merged into one corporate entity.
They will take a step on that road soon, with the announcement of a unified management structure. That announcement could come along with today’s earnings report.