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Ford’s Q1 earnings slip 7%, missing Wall St. estimates

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Ford’s Q1 earnings slip 7%, missing Wall St. estimates

Ford earned $924 million in the first quarter, down almost 7% from a year ago and below Wall Street estimates with greater losses than anticipated in South America and tight inventories of the profitable F-150 pickup, the automaker announced today. The automaker reported revenue of $33.9 billion, down $2 billion from a year ago, with heavy launch costs and loss of production of key vehicles while Europe and South America also remain the trouble spots, both reporting losses for the quarter.127575-10-ford-motor-company

North American operations earned $1.3 billion, below last year’s $1.5 billion. Chief Financial Officer Bob Shanks said F-150 volume was down more than 50% or 60,000 units from a year ago with the Kansas City plant still ramping up — it should be at full production by mid-year

And volume of the Edge was down 40% or 15,000 units with the plant changeover to the model at the assembly plant in Oakville, Ont. Shanks said full volume and sales of these two vehicles would have increased revenue by another billion and the dip in market share experience now will be more than made up by the end of the year. Overall, Ford reported earnings of 23 cents per share, below the 26 cents expected by Wall Street. The company’s $1.4 billion pretax profit was up $24 million from a year ago.

A year ago, Ford’s results factored in a costly recall, bad weather and devalued currencies that resulted in a $989 million profit, far below expectations and substantially below the $1.6 billion reported in the first quarter of 2013. But Ford’s year of a record 24 product launches is behind it and the automaker maintains this will be a breakthrough year. The automaker now expects operating profit margins in North America of 8.5% to 9.5% for the year, up by half a point. Operating margin dropped to 6.7% in the first quarter but Shanks said it would have exceeded 10% if Ford had not lost so much profitable F-150 and Edge production.

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