Ford Motor said Monday that inflation and shortages of some parts will push parts costs $1 billion higher than expected in the third quarter.
The company and other automakers have been slowing down for nearly two years due to a shortage of computer chips. Industry executives had expected the pressure to ease later this year, but Ford warns that supply chain disruptions continue to hit automakers and could drag on into 2023. It is shown that.
Ford said it expects the third quarter to end with 40,000 to 45,000 near-finished vehicles that can’t be shipped to dealers because certain parts are missing. That’s higher than the company expected. About 53,000 vehicles were not completed in July.
The automaker warned that most of the unfinished models include high-margin trucks and multi-purpose sports cars that generate a significant portion of Ford’s profits.
The company expects third-quarter adjusted and pre-tax earnings to be between $1.4 billion and $1.7 billion. But Ford is sticking to his previous forecast of adjusted earnings for the full year of $11.5 billion to $12.5 billion.
To hit that target, Ford will need to put in a strong performance in the final three months of the year, given higher costs from July to September. We report our third quarter results.
After Ford’s announcement, the company’s shares fell about 4% in Monday’s extended trading session.