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Ford Pulls Full-Year Forecast Due to Union Contract

Reports expanded pullback of EV production in third-quarter report.

October 27, 2023
Ford Pulls Full-Year Forecast Due to Union Contract

Ford said many North American consumers resist paying more for EVs than gas-powered models or hybrids, 'sharply compressing EV prices and profitability.'

IMAGE: Ford

2 min to read


Ford in its third-quarter report Thursday withdrew full-year earnings guidance due to its pending new contract with the United Auto Workers, while also reporting more deceleration of its electric-vehicle business.

The automaker said wholesale deliveries of its first-generation EVs rose 44% in the quarter and that revenue increased 26%. But the unit's earnings before interest and taxes sustained a $1.3 billion loss, more than in the second quarter, which it attributed to investment in new EV models and “challenging market dynamics.”

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Ford said many North American consumers resist paying more for EVs than gas-powered models or hybrids, “sharply compressing EV prices and profitability."

“Ford is able to balance production of gas, hybrid and electric vehicles to match the speed of EV adoption in a way that others can’t,” said CFO John Lawler in a press release. “That’s obviously good for customers, who get the products they want – and good for us, too, because disciplined capital allocation and not chasing scale at all costs maximizes profitability and cash flow.”

U.S. EV market leader Tesla has sacrificed revenue for volume this year with a series of price cuts, and Ford and others followed with their own EV price cuts.

Overall, Ford’s quarterly revenue rose 11% year-over-year to $44 billion. Its adjusted EBIT totaled $2.2 billion and so far this year is at $9.4 billion; it earlier forecast up to $12 billion for the full year but withdrew that due to the impact of the pending union contract, which includes 25% worker pay raises.

LEARN MORE: Ford, UAW Reach Tentative Deal

Topics:Industry

Originally posted on Auto Dealer Today

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