Net income dropped to $1.21 billion (0.9bn), from $1.95 billion, in the year-ago quarter, the company said in a statement.
Ford said it would break even at best in the second quarter and cut an additional 35,000 vehicles from its planned North American production for the period. The drop in first-quarter profit and the prospect for a second-quarter loss threaten chief executive William Clay Ford Jnr’s three-year streak of improved financial performance. The company said its car operations may not earn a profit this year, leaving it to rely on car loans to sustain profits. Ford Motor, of Dearborn, Michigan, earned $3.49bn last year.
The company may sell its Hertz rental-car unit to ensure future liquidity, Ford executives said yesterday. “Now is the right time,” to explore the future of Hertz, Bill Ford, 47, said. The results were above Ford’s initial first-quarter forecast of 25 cents to 35 cents a share, excluding some costs. Ford deepened cuts in its second-quarter North American production plans to 4.8% below a year earlier, from the previous 1.2%. Ford plans to build 905,000 vehicles in North America this quarter, down from the previous forecast of 940,000.
Ford’s worldwide car operations had a first-quarter profit of $579m, down from $1.83 billion.