10-QPeriod: Q2 FY2003

FORD MOTOR CO Quarterly Report for Q2 Ended Jun 30, 2003

Filed August 1, 2003For Securities:FF-PCF-PDF-PB

Summary

Ford Motor Company's second quarter 2003 report shows a net income of $417 million, or $0.22 per diluted share, a decrease from $570 million ($0.29 per share) in the same quarter of the prior year. This decline was primarily driven by a significant drop in operating income within the Automotive sector, which fell from $587 million to $26 million. While Financial Services income increased, it could not fully offset the automotive weakness. Total revenues also saw a decline to $40.7 billion from $42.2 billion year-over-year. The company is navigating a challenging market with decreasing unit sales and increasing costs, particularly in pension and healthcare benefits. Despite these headwinds, Ford is focusing on cost performance improvements and strategic product launches to improve future results.

Key Highlights

  • 1Net income for the second quarter of 2003 was $417 million, down from $570 million in the prior year's quarter.
  • 2Diluted earnings per share decreased to $0.22 from $0.29 year-over-year.
  • 3Automotive sector operating income saw a substantial decline, dropping from $587 million to $26 million.
  • 4Total company sales and revenues decreased to $40.7 billion from $42.2 billion in the comparable quarter.
  • 5Financial Services sector income before taxes increased to $715 million from $600 million.
  • 6Worldwide Automotive unit sales of cars and trucks declined to 1,717,000 units from 1,854,000 in the prior year's quarter.
  • 7The company reported strong cost performance in the Automotive sector, partially offsetting revenue declines.

Frequently Asked Questions

Ford reported a net income of $417 million, or $0.22 per diluted share, for the second quarter of 2003. This is a decrease compared to the $570 million net income, or $0.29 per diluted share, reported in the second quarter of 2002.

The primary driver for the decrease in net income was a significant decline in the Automotive sector's operating income, which fell from $587 million in Q2 2002 to $26 million in Q2 2003. While the Financial Services sector saw an increase in income, it was not enough to offset the automotive sector's performance.

Total company sales and revenues for the second quarter of 2003 were $40.7 billion, a decrease from $42.2 billion reported in the same period of 2002. This decline was reflected in both the Automotive sector's sales and the Financial Services sector's revenues.

Ford projects a loss of approximately $0.15 per share for the third quarter of 2003 and expects full-year 2003 earnings to be around $0.70 per share. The company anticipates continued cost reductions and new product introductions, but also faces challenges from increased competition, economic uncertainties, and rising pension and healthcare costs.