By DEE-ANN DURBIN
DEARBORN, Mich. -- Ford Motor (F) beat Wall Street's expectations in the second quarter as it chalked up a record profit in North America and made money in Europe for the first time in three years.
But things will get leaner in the second half as Ford closes one of its U.S. pickup truck plants to prepare for its new aluminum-sided F-150 and spends more on materials and advertising. Ford, which earned $3.9 billion before taxes in the first half of this year, confirmed it expects full-year earnings of $7 billion to $8 billion. That's down from $8.6 billion in 2013.
For the April-June period, Ford's net income rose 6 percent to $1.3 billion. The profit, of 32 cents a share, was up from 30 cents a share in the same period a year ago.
Excluding separation costs in Europe and a $329 million impairment charge for its money-losing joint venture in Russia, Ford earned 40 cents a share. That beat analyst forecasts of 36 cents, according to FactSet.
Ford's revenue fell 1 percent to $37.4 billion, ahead of analyst expectations of $36.2 billion. Worldwide sales fell 1 percent to nearly 1.7 million. Sales were down in every region except Asia Pacific, where they jumped 21 percent thanks to strong sales of new vehicles like the Kuga SUV in China.
Ford reported its highest-ever pretax profit of $2.4 billion in North America. The company's U.S. sales fell, partly because it pulled back on truck deals to ensure it has enough inventory as it transitions to the new F-150. But Chief Financial Officer Bob Shanks said that was offset by lower costs for materials such as steel and increases in sales of parts and accessories.
Ford plans to close its Dearborn truck plant for eight weeks beginning in August. The new F-150, with aluminum sides that shave 700 pounds off the truck's weight, is scheduled to go on sale in the fourth quarter.
In Europe, the company made $14 million. Sales were down slightly, but the company has cut costs by closing two plants in the United Kingdom. A third plant in Belgium will close at the end of this year.
In Asia, Ford's profit jumped 22 percent to $159 million. Ford said its market share in the Asia Pacific region hit a record 3.7 percent.
Ford lost $295 million in South America, where its sales were down 23 percent.
Ford 2Q Earnings Rise on Record North America Profit
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