Ford Posts Worst Quarterly Results in 4 Years...Fallout From EV Exit

Q4 net loss of 11.1 billion dollars
2 billion dollars in parts tariffs also weigh on earnings

Reuters and Yonhap News Agency

Ford, one of the leading U.S. automakers, has reported its weakest quarterly results in four years. The company is analyzed to have incurred a large loss due to costs arising from its withdrawal from the electric vehicle business at the end of last year, as well as tariff expenses on imported parts stemming from the aftermath of the U.S. tariff war.

According to CNBC, on the 10th (local time), Ford announced its fourth-quarter results after the close of the New York Stock Exchange, stating that it had posted a massive net loss of 11.1 billion dollars (about 16.2 trillion won). It also reported that its adjusted earnings per share (EPS) came in at 13 cents, 32% below the market consensus of 19 cents. This is being evaluated as the worst loss in four years since the fourth quarter of 2021.

Total revenue fell 5% year-on-year to 45.9 billion dollars, while automotive sales revenue reached 42.4 billion dollars, in line with market expectations. However, costs related to the suspension of electric vehicle production in December last year undermined profitability. Ford stated that the withdrawal of its electric vehicle production line in December last year generated costs of 19.5 billion dollars, of which 12.5 billion dollars were recognized in the fourth quarter, with the remaining 7 billion dollars to be recognized separately in 2026 and 2027.

The aftermath of the tariff war that began after U.S. President Donald Trump took office in January last year also affected Ford’s profitability. Ford said that in this fourth-quarter result, an additional 900 million dollars in tariff expenses were incurred because the application of tax credits for auto parts was delayed. According to CNBC, Ford incurred about 2 billion dollars in additional costs last year, including tariff expenses on imported parts.

Sherry House, Ford’s Chief Financial Officer (CFO), explained the reasons for the weak performance at a press conference that day, saying, “The impact of tariffs amounted to about 2 billion dollars, and we expect it will remain almost unchanged at around 2 billion dollars in 2026,” adding, “There was also an impact from a fire last year at the Novelis aluminum supplier plant located in New York.” The plant has been supplying aluminum for Ford’s high-margin F-Series pickup trucks, but due to the fire, it is expected to be fully normalized only from the middle of this year onward.

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