Ford posts $997 million net Q3 profit, boosts cash


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Jesse Snyder
Automotive News
November 2, 2009 - 7:20 am ET

DETROIT -- Ford Motor Co. posted a surprise net profit of $997 million in the third quarter and its cash position turned positive, reversing a long stretch of cash burn.

Ford’s pre-tax operating profit of $1.1 billion for the quarter marked its first quarter in the black since the first quarter of 2008. The automaker ended the quarter with $23.8 billion in cash, up $2.8 billion from the end of the second quarter.

Ford North America posted a pre-tax operating profit of $357 million for its first positive quarter since the first three months of 2005.

Ford attributed the improved performance to new products, reduced structural costs and improved results at Ford Credit. The automaker posted U.S. sales increases in July and August, aided by the cash-for-clunkers program, and lifted its market share for the quarter.

"Our third-quarter results clearly show that Ford is making tremendous progress despite the prolonged slump in the global economy," said Ford CEO Alan Mulally.

Ford, which had said it would hit "break-even or better" in 2011, said it now predicts the company will be "solidly profitable" that year on a pre-tax basis, not including special items. Ford will have positive automotive operating-related cash flow that year, the automaker said.

Ford said it was more uncertain about the 2010 economic outlook. The company said it predicted European auto sales will decline substantially as scrappage incentive programs end, while U.S. sales volumes may improve somewhat from this year's levels.

Ford is predicting U.S. total sales of 10.6 million vehicles this year, including a couple hundred thousand medium- and heavy-duty trucks. Ford has forecast 2010 total U.S. sales of 12.5 million units.

You can reach Jesse Snyder at jsnyder(at)crain(dot)com.
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