Ford Motor Corp., the second-largest U.S. automaker is revamping its internal five-year business plan to take into account the marked deterioration in the European economy, Bob Shanks, Ford CFO said.
‘We have to develop a better plan in response to what’s going to be a much less favorable external environment,’ CFO Bob Shanks said.
‘How do we tack to respond to new realities? That’s what we’re in the process of doing.’
The executive declined to give more details about the new plan mostly because the updates are confidential.
Ford may lose between $500 million and $600 million this year in Europe, where auto sales are heading toward the low end of the company’s forecast.
The U.S based automaker said first quarter net income was $1.4bn(£862m), down from $2.6bn for the same quarter last year. Ford said about half the drop was due to it paying a higher tax rate.
Ford made a loss of $149m in Europe where many economies are struggling. The carmaker’s sales in Europe were down by 60,000.
Last year, the automaker reported an annual operating profit of $8.8 billion, almost 6% above the prior year (2012). Full-year net income reached $20.2 billion, a gain of more than 200%. That included a special one-time, non-cash accounting change from the reversal of Ford’s deferred tax assets.
Flooding in Thailand led to a loss in Asia, and increased competition blunted profits in South America.