Ford "Production Disruptions Due to Supply Chain Issues"... Stock Price Plummets Most in 11 Years

"Delivery Supplier Costs Increase by $1 Billion More Than Expected"

[Photo by AP Yonhap News]

[Asia Economy Reporter Park Byung-hee] U.S. automaker Ford's stock price plummeted 12.3% on the 20th (local time), marking the largest drop in 11 years, CNBC reported on the same day. Ford's market capitalization decreased by about $7 billion in a single day.

Ford announced after the New York Stock Exchange closed the previous day that production was disrupted due to a shortage of parts caused by supply chain issues. It further stated that 40,000 to 45,000 vehicles, mainly high-margin trucks and sport utility vehicles (SUVs), were not delivered to customers.

Ford explained that in recent negotiations with suppliers over parts supply, costs increased by $1 billion more than initially expected, attributing this to inflation.

Ford forecasted its adjusted net profit for the third quarter to be between €1.4 billion and €1.7 billion, which is significantly below analysts' expectations. Some analysts anticipate Ford's third-quarter net profit to be close to $3 billion.

However, Ford did not revise its annual profit outlook downward.

CNBC explained that the market had been expecting supply chain issues to be resolving, but Ford made an announcement contrary to this view.

Mark Delaney, an analyst at Goldman Sachs, said, "Considering that Ford had been handling supply chain disruptions better than its competitors, this third-quarter earnings forecast was surprising."

On the same day, Mary Barra, CEO of Ford's competitor General Motors (GM), expressed a contrasting view to Ford's announcement in an interview with CNBC, stating that supply chain issues are being resolved.

CEO Barra said, "The situation is improving," adding, "We continue to produce, solve problems, and pursue efficiency."

This content was produced with the assistance of AI translation services.