Ford Motor reported after-hours earnings on Tuesday and announced the launch of a new small electric vehicle, sending its shares up more than 6% in after-hours trading. Ford highlighted the company's excellent positioning and revenue performance, and plans to save about $2 billion through cost reductions and provide more options including gasoline, hybrid and electric vehicles to meet consumer demand. At the same time, Ford also plans to pay a special dividend to shareholders.
Ford CEO Farley noted at the earnings briefing that despite the company's good results in 2023, further efforts are needed. He said Ford will focus on developing smaller, next-generation electric models and reduce investment in larger electric vehicles.
Considering the slowdown in EV sales, Ford wants to reduce spending on its EV division by about $12 billion and increase production of traditional internal combustion engine models in recognition of the importance of traditional gasoline vehicles to the company's future growth. Farley stressed that they will do everything they can to reduce costs and boost their EV teams under pressure from competitors such as Tesla and Chinese OEMs.
Investors agreed with Farley's speech, and Ford's share price saw a sharp ** in the after-hours trading session, peaking as high as an 8% gain and stabilizing at more than 6%. Senior analysts believe that demand for Ford's traditional internal combustion engine models, such as trucks and SUVs, in the North American market continues to be strong, and investors are encouraged by the company's continued cost-saving measures. In addition, Ford will focus more on cash distributions to shareholders, which is always a positive sign.
According to Ford's earnings report, adjusted earnings per share for the last quarter were 0$29, far exceeding analysts' expectations of $0$13 and more than doubled. Last quarter's revenue was $46 billion, also beating analysts' expectations of $40.3 billion. Ford expects earnings before interest and taxes to be $10 billion to $12 billion for the full fiscal year, $400 million higher than the earnings base projected for 2023.
Ford delivered impressive financial results in the last quarter while improving its competitiveness by introducing small electric vehicles and cost-cutting initiatives. However, in the face of increased competition in the EV market, Ford needs to make further efforts to reduce costs and increase its EV market share in order to cope with competitive pressure from Tesla and Chinese OEMs. Investors support the company's growth strategy and cost-saving measures, and expect Ford to continue to pay cash to shareholders. Overall, Ford's efforts to find a balance between electrification and conventional models will be a long and challenging process.
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