NEW YORK, April 29 — Ford warned yesterday that it expects a second-quarter operating loss of US$5 billion in the wake of the coronavirus crisis, sending its share price lower.
The bad news comes on the heels of Ford’s announcement that it suffered a US$632 million loss in the first quarter following a negative hit of more than US$2 billion from Covid-19.
Revenues fell 15 per cent to US$34.3 billion as car sales declined in all of Ford’s markets, the automaker said yesterday.
Ford said it expects a “phased restart” of European plants to begin next week, but the company still has not released a timetable for resuming operations in the United States after factories were shuttered in March.
Like many companies in struggling sectors, the Covid-19 crisis has forced companies to refashion their budgets so that they have sufficient liquidity.
Ford has suspended its dividend, lowered spending and raised some US$23 billion through existing credit lines as well as bond issues.
“We’ve taken decisive actions to lower our costs and capital expenditures and been opportunistic in strengthening our balance sheet and optimizing our financial flexibility,” Chief Financial Officer Tim Stone said.
“We believe the company’s cash is sufficient to take us through the end of the year, even with no additional vehicle wholesales or financing actions.”
Shares of Ford fell 5.4 per cent to US$5.09 in after-hours trading. — AFP