Ford posts record profit

Visitors look inside a Ford SUV displayed at the Shanghai Auto Show in Shanghai on April 21, 2011. About 2,000 car and parts makers from 20 countries are participating in the Shanghai auto show, showcasing 75 new car models, 19 of them making their world premieres. AFP PHOTO/Philippe Lopez (Photo credit should read PHILIPPE LOPEZ/AFP/Getty Images)©AFP

Ford recorded its most profitable quarter ever in the first three months of the year, helped by surging North American revenues and a stronger performance in Europe, as net income more than doubled from $ 1.15bn to $ 2.45bn.

The jump mainly reflected continuing record sales in North America. Ford benefits in the region from its strong position in the market for sports utility vehicles, which have regained popularity with falling oil prices, and the popularity of its F150 pick-up truck, North America’s most popular single vehicle. Pre-tax profits in the region nearly doubled from $ 1.57bn last time to $ 3.08bn, on revenue up 19 per cent to $ 23.9bn.

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In Europe, the company also benefited from the popularity of its SUVs and recorded a pre-tax profit of $ 434m, against a $ 42m loss for last year’s first quarter, on flat revenue of $ 6.9bn.

Mark Fields, chief executive, called the results “an absolutely terrific start to the year,” hailing it as a record for the company with very strong performances across the business.

“We’re excited about our future and confident in our ability to deliver long-term growth and profitability, as we expand our business model to be both an auto and a mobility company,” Mr Fields said.

Ford’s shares were up 1.46 per cent in pre-market trading in New York, at $ 13.86.

The results mark a sharp contrast to last year’s disappointing first quarter, when Ford was not able to produce the F150 fast enough to keep up with demand. Production of the vehicle had been briefly halted at first its Dearborn, Michigan, then its Kansas City, Missouri, plants for a switchover to a revolutionary aluminium body, designed to improve fuel efficiency and other aspects of performance.

The resumption of full-rate production of the F150 and other popular vehicles combined with the strong sales rate to produce a 20 per cent surge in sales of vehicles in North America against last year’s first quarter, to 814,000. The company also increased its market share to 14.6 per cent, from 14 per cent.

The company also increased its vehicle sales in Europe by 6 per cent but reported flat revenue because of the strength of the US dollar.

However, economic turmoil in South America deepened the company’s pre-tax loss there to $ 256m, from $ 189m last time, on revenue down 44 per cent to $ 800m. The company has suffered the effects of Brazil’s recession and the devaluation of Argentina’s currency.

Group-level revenue rose 11 per cent to $ 37.7bn.

Earnings per share nearly doubled, to 61 cents from 32 cents last time.

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