Ford Motor (F), the Dearborn, Mich.-based auto maker, reported a narrowed loss in the third quarter, and said its liquidity position should be fine.
Alan Mulally, President and CEO of Ford told Fox Business that Ford performed very well worldwide, and mentioned South America and Asia as positives. However, the sales rate in the U.S. is lower than it’s been in 35 years. Mulally added that consumer confidence and a bad economy were at the root of the problems.
“It’s clearly a very very tough economic environment, now having said that, we feel like we’re making great progress on our plan, on the transformation of our product line and restructuring to operate profitably.”
Ford reported a $129 million loss for the third quarter, a six cent per-share loss for the period. That's less of a loss than the company reported in the same period last year of $380 million, or 19 cents per share.
The company went through $7.7 billion cash in the quarter, and has been struggling through the economic crisis, evidenced in the second quarter, when it experienced the highest three-month loss in its history, $8.7 billion.
However, Dow Jones Newswires reported that Chief Financial Officer Lewis Booth said the company is "comfortable with its liquidity position." That's in contrast to fellow Big Three auto maker General Motors (GM), whose survival prospects look dubious after it said Friday morning that it's basically running out of money.
Ford reported a drop in this quarter’s sales of 22% from $41.1 billion last year to $32.1 billion this year. It also announced the cutting of 2,260 jobs in North America, which is 10% of its work force.
The company experienced a pretax loss of $2.7 billion from continuing operations. However, these losses were offset by $2 billion received when it changed over retired workers' health-care liabilities to a United Auto Workers trust.
Mulally said that Ford anticipated an economic slow down in years past which led the company to take out a $25 billion loan.
“We’ve got that $30 billion, and we are managing it very carefully. Going forward, it really depends on the economy,” Mulally said.
He added that Ford was focused on the future, including productivity and quality improvements.
Ford’s non-GAAP losses of $1.31 a share were greater than the Thomson Reuters analyst estimates of 94 cents per share on $28 billion in sales.
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