Ford posts third consecutive annual profit despite speed bumps
Ford Motor Company posted its third consecutive annual profit last year.
It’s another sign that the company’s massive restructuring effort, which began in 2006, has returned the company to financial health.
"This was our plan," said Ford CEO Alan Mulally. "This is our vision of growing a great company for the good of all of us."
Ford made an $8.8 billion pre-tax operating profit last year, not including a one-time tax gain. That compares to an $8.3 billion pre-tax operating profit in 2010.
The 2011 profit was largely driven by strong performance in North America. Ford encountered speed bumps elsewhere, in Europe with the sovereign debt crisis, in Latin America, with increased competition, and in Asia Pacific, with flooding in Thailand.
Mulally notes that production is almost back to normal in Thailand, as supplier disruptions ease. And he says the company is building new factories in China, India, and Thailand to capitalize on growing car sales in the region.
Ford’s U.S. factory workers will each get roughly 62-hundred dollars in profit sharing for 2011.
The one-time tax gain brought Ford's annual profit to $20.2 billion, its second-highest ever. The gain eliminates the majority of a tax allowance that the company created in order to retain tax credits when it was losing money.
Despite the profit, Wall Street responded negatively, apparently disheartened by the company's performance in the fourth quarter, which was lower than analysts' expectations. The value of Ford stock dropped in the morning.
Mulally says Ford is well on its way to achieving a goal of $10 billion in debt by "mid-decade." The company currently has $13.1 billion in debt. Ford has dramatically reduced its debt load from a high of nearly $35 billion just a few years ago.
He says the company may put some of its cash in 2012 into the pension fund, which is significantly underfunded.