DETROIT (AP) — Ford Motor Co.’s second-quarter net income fell 4.7% from a year ago as the company’s combustion engine unit posted a pretax loss due to higher warranty costs.
The Dearborn, Michigan, automaker said Wednesday it made $1.83 billion from April through June, compared with $1.92 billion a year ago.
Excluding one-time items, Ford made 47 cents per share, short of industry analysts’ estimates of 68 cents, according to FactSet.
The automaker reported $47.8 billion in revenue for the quarter, a 6.3% increase over the $44.95 billion in the second quarter of 2023. That barely beat analyst estimates of $47.79 billion.
Ford has been vexed by warranty and recall costs over the past few years, but Chief Financial Officer John Lawler told reporters that the company is making progress on quality. The second-quarter costs were attributed to older vehicles from the 2021 model year and earlier.
The company said its second-quarter warranty costs were $2.3 billion, $800 million higher than the first quarter and $700 million more than a year ago.
Ford Blue, the company’s internal combustion engine unit, made $1.17 billion before taxes during the quarter, down $1.1 billion from a year earlier. Ford Pro, the commercial vehicle unit, made $2.56 billion, $173 million above 2023. Model e, the electric vehicle unit, lost $1.14 billion, $63 million worse than a year ago.
Despite the net profit drop, Ford held its full year guidance for pretax income at $10 billion to $12 billion.
Ford’s second quarter sales in the U.S., its most lucrative market, rose just under 1% to more than 532,000 vehicles.
Shares of Ford, which had been up about 12% year to date, fell about 10% in after-hours trading Wednesday after the results were announced.
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This story has been updated to correct the headline to read that Ford’s combustion engine unit’s pretax profit dropped but it did not post a loss.
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