Ford’s pre-tax profits drop by 84%

REVENUES at the Irish arm of motor giant Ford plunged by more than €205 million last year as pre-tax profits decreased sharply by 84.

Managing director of Henry Ford & Son, Eddie Murphy, said yesterday that the drop in revenues last year brought the company back 25 years in terms of comparable revenues.

Mr Murphy — who is also president of the Society of the Irish Motor Industry (SIMI) — that the company’s sales in Ireland in 2010 “have rebounded, but this is from a 25-year low”.

Mr Murphy said sales throughout the car industry in Ireland were down 65% last year.

Accounts just filed by the Cork-based Henry Ford & Son Ltd show that the company’s revenues dropped by 71% from €287.9m to €82.7m to the end of December last.

The company imports and distributes Ford cars in Ireland and the directors’ report states that the decrease in turnover “reflects the reduction in demand for new vehicles associated with the economic downturn”.

The returns show that pre-tax profits decreased by €8.3 million from €9.9m to €1.5m last year.

“Last year, we were still able to write the figures with black ink and the company battled hard and was able to increase market share.”

He added that while revenues at the firm “are significantly up” this year on last year, “it is still far from being acceptable and way below what revenues we have had, but they are part of the dynamic of an economy going through a downturn”.

Mr Murphy said that Ford was the market leader in car sales in Ireland in 2008, 2009 and will be the market leader again this year.

He said that Henry Ford & Sons Ltd recorded under 6,000 units of wholesale sales last year and he expects this to increase to 14,000 units this year.

Mr Murphy said that he is “apprehensive” in relation to the company’s performance for 2011, stating that the Government should extend the car scrappage scheme — due to finish at the end of the year — for a further six months.

Mr Murphy said the scheme has worked very well and stabilised employment in an industry that was “in a very, very dark environment 12 months ago”.

The accounts show that the company had accumulated profits of €72m.

The numbers employed by the company remained at 35 last year, with staff costs increasing by 61% from €3.9m to €6.4m. However, wages and salaries to staff, including executive directors, decreased marginally from €2.4m to €2.3m, but an additional €2.6m on pension costs was the factor behind the steep rise in the staff costs.