Ford shares skid despite a bullish 2022 outlook
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[February 04, 2022] By
Joseph White and Paul Lienert
DETROIT (Reuters) -Ford Motor Co ended 2021
with $36 billion in cash, a crop of hot-selling new electric vehicles
and a bullish forecast for revenue and profit growth this year, but that
was not enough for investors.
Ford shares dipped as much as 5% in after-hours trading on Thursday
after the automaker's fourth-quarter income fell short of analysts'
expectations and the company forecast a slower recovery in 2022 vehicle
production than rival General Motors Co.
The sour response to Ford's results presents a challenge to Chief
Executive Jim Farley, who is trying to accelerate the company's pivot
toward electric vehicles.
Ford said it has 275,000 orders for its electric F-150 Lightning,
Transit vans and Mustang Mach-E utility vehicles, and expects to double
electric vehicle production capacity to 600,000 vehicles a year by 2023.
Chief Financial Officer John Lawler said during a call with reporters
that Ford expects 2022 earnings before interest and taxes to grow by 15%
to 25%, outpacing the predicted 10-15% increase in vehicle production.
Ford should hit an 8% pretax profit margin this year, a year ahead of
schedule, he said.
But investors sold shares after Ford's fourth-quarter adjusted earnings
per share of 26 cents fell 19 cents short of the 45 cents analysts were
expecting, according to Refinitiv I/B/E/S.
![](http://archives.lincolndailynews.com/2022/Feb/04/images/ads/current/peasleymemorials_lda_2022.png)
Earlier this week, General Motors forecast a 25-30% production increase
for this year compared with last year, and operating profit of $13
billion-$15 billion.
"While the 4Q print is a disappointment, we believe the more critical
takeaway from the print is a solid ’22 guide," Credit Suisse analyst Dan
Levy wrote in a note.
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![](../images/020421pics/busine17.jpg)
A man stands near the Ford logo during a media day for the Auto
Shanghai show in Shanghai, China April 19, 2021. REUTERS/Aly
Song/File Photo
![](http://archives.lincolndailynews.com/2022/Feb/04/images/ads/current/graue_21BLAZER_081621.png)
Lawler said the fourth-quarter result reflected worse-than-expected supply-chain
problems.
"There are supply-chain disruptions that can impact any one of us in a quarter,"
he said. "You have to look at long term."
Ford enters 2022 in a stronger financial position than it has enjoyed in years.
The company said it has $36 billion in cash and $52 billion in liquidity. Those
numbers include Ford's stake in electric truck and van maker Rivian Automotive
Inc, valued at $10.6 billion at the end of 2021.
Despite a forecast that costs for steel, resins and other raw materials will
rise as much as $1.5 billion to $2 billion, Lawler said Ford is confident it can
boost production and hold strong prices to deliver pretax profit between $11.5
billion and $12.5 billion.
Ford plans to use some of its cash hoard to ramp up capital spending in 2022 to
$7 billion to $8 billion from $6.2 billion in 2021, and execute $1.8 billion to
$2.4 billion in restructuring.
For all of 2021, Ford reported an operating profit of $10 billion, and an
operating margin of 7.3% for the year. Full-year net income of $17.9 billion
included a gain on its investment in Rivian.
Fourth-quarter net income rose to $12.3 billion from a $2.8 billion loss a year
ago. Adjusted earnings before interest and taxes rose to $2.0 billion from $1.7
billion a year ago.
(Reporting by Paul Lienert and Ben Klayman in DetroitWriting by Joseph
WhiteEditing by Matthew Lewis)
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