AUTO INDUSTRY Ford exec praises progress on targets
Ford's market share is increasing, and new models are on the way.
DETROIT (AP) -- Bill Ford Jr., Ford Motor Co. chairman and chief executive, said the automaker's restructuring was working and the company was on track to meet year-end financial targets despite heavy incentives that are eating away at vehicle pricing and profits.
The world's second-largest automaker, in the midst of a turnaround effort started in January 2002, said Tuesday it still expected to meet its 2003 earnings goal of 70 cents a share, a figure that garnered skeptics among analysts earlier this year but is now in line with Wall Street forecasts.
Ford earned nearly $900 million in the first quarter after two years in which it lost a total of $6.4 billion because of bloated costs and a string of poor vehicle launches.
"We've come a long way, I think, faster than a lot of watchers would have predicted," Ford said at the company's annual spring meeting for investors and analysts. "We have a ways to go. We're in the middle of a five-year plan ... but so far I feel very good about it."
Current goals
Ford executives said the key to meeting company objectives continued to be reducing costs, which helps offset rising health-care expenses and troubles the company has experienced pricing vehicles.
The automaker's goal is to slash costs by $500 million this year. Chief Financial Officer Allan Gilmour said the company may do even better than that, though he declined to give specifics.
Ford said last month it was intensifying efforts to slash its $30 billion budget for costs not directly related to vehicles by as much as 20 percent over the next two years. The company said the effort is part of a goal to improve profits by $9 billion by mid-decade.
Vehicle pricing, however, has become one area of concern, and Ford said it may miss its 2003 pricing targets in North America and Europe as competition intensifies and the company continues to use incentives to spur sales.
New products
Bill Ford said the company's plans to introduce 65 new Ford, Lincoln and Mercury products in North America in the next five years should ease concerns he heard from analysts a year ago about a lackluster product lineup.
Ford will launch a redesigned F-150 pickup, its best-selling vehicle, later this year, then turn its attention to cars. Among the new offerings for 2004: the large Ford Five-Hundred sedan and the Freestyle, a roomy car-based utility vehicle. Ford also will introduce a new Mustang in 2005.
Mike Wall, an industry analyst with CSM Worldwide, noted another positive for Ford: market share. He said the automaker's U.S. market share so far this year -- including Volvo, Jaguar and Land Rover -- was 21.3 percent, up from 20.9 percent a year ago.
Meantime, General Motors Corp.'s comparable market share, including Saab, is 27.3 percent, off from 28.6 a year ago. DaimlerChrysler AG's Chrysler Group is at 13.3 percent, down from 13.8 percent a year ago, Wall said.