Ford Revision More Than Doubles 2Q Loss
Ford's revision follows a similar move by cross-town rival GM, which upped its 2Q losses by $200 million.
Ford Motor Co.’s woes continue to mount as the auto maker revises its second-quarter loss to $254 million, more than doubling the $123 million in red ink originally reported two weeks ago.
The auto maker says the readjustment is due to pension costs related to North American job cuts, which are an integral part of Ford’s ongoing North American Way Forward restructuring strategy.
In an earlier filing with the U.S. Securities and Exchange Commission, Ford said its full-year pension costs would amount to $1 billion. Ford has now raised that estimate to $1.2 billion.
The revision brings the company’s net loss for the quarter to 14 cents per share.
Ford also announces in a regulatory filing that it changed its 2006 outlook to a loss for its Premier Automotive Group stable of European luxury marques. Earlier forecasts called for PAG to break even for the year.
Ford’s cross-town rival General Motors Corp. also revised its second-quarter financial results earlier this week. It now says it lost $3.4 billion, $200 million more than originally reported.
The world’s largest auto maker says the revision is due to “change in the estimated tax provision related to an expected loss on the pending sale of 51% interest in GMAC.”
Originally GM said the after-tax charge for the GMAC transaction would amount to $490 million. That has been increased to $690 million due to differences in book value and tax bases at some GMAC subsidiaries, the auto maker says.
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