Ford Motor Earns $3.0 Billion in Q3

Ford Motor Company late today posted an adjusted EBIT of $3.0 billion with margin of 8.4%. Third-quarter cash flow from operations was $7.0 billion and adjusted free cash flow was $7.7 billion, both up from the second quarter largely because of the higher vehicle wholesales and profitability. The company ended Q3 with $31.5 billion of cash and $47.4 billion in total liquidity.

Once again market share slipped to 4.9% from 6% y-o-y as wholesales dropped to 1,012,000 from 1,178,000. At the end of the third quarter, new vehicle inventory for all makers in the U.S. was just under a million units or approximately 24 days of supply, says NADA. This is a 65% decrease from the start of 2021. In contrast, at the end of the third quarter in 2020, inventory was at 2.7 million units or a 50-day supply.

Third-quarter revenue of $35.7 billion was down from the same quarter a year ago. Semiconductor availability remains a challenge, but “markedly improved from the second quarter, propelling sequential increases in wholesale shipments and revenue of 32% and 33%, respectively.”

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Executive summary: Ford’s revenue, net income, adjusted earnings before interest and taxes, cash flow from operations, and adjusted free cash flow were all higher from the second to the third quarter of 2021, because of “significant increases in semiconductor availability and wholesale vehicle shipments from Q2.”

Ford, Argo AI and Walmart last month said they are working on a “last mile” autonomous-vehicle delivery service for customers in Miami; Austin, Texas; and Washington, D.C. – cities where Ford and Argo AI already have operations. The program will use Ford self-driving test vehicles equipped with Argo AI’s self-driving system.

CEO Jim Farley said that Ford “fully supports” Argo AI’s plan to access public capital. The deal blends Argo, a self-driving technology provider, with an automotive manufacturer able to integrate that technology with mass-produced vehicles and the world’s largest retailer. The multi-city service will allow Walmart customers to place orders of groceries and other popular items online for door-to-door autonomous delivery directly to customers’ homes. (Ford, Argo AI, Walmart to Launch Autonomous Vehicle Delivery)

Ford upped guidance for full-year 2021 adjusted EBIT to between $10.5 billion and $11.5 billion. It also said it expects cash flow during the  current planning period to be more than sufficient to fund growth priorities. Ford also announced the resumption of regular stock dividend in fourth quarter.