Author: FutureCar Staff
Ford Motor Co announced its fourth-quarter results for 2021 on Thursday, which included increased revenue as the company moves away from semiconductor shortages that impacted vehicle production in 2021.
The automaker’s fourth-quarter results include revenue of $37.7 billion with net profit of $12.3 billion. Ford reported operating profit of $10 billion and an operating margin of 7.3% for the year.
Net income for the year was $17.9 billion after adjusted EBIT of $10.0 billion after reclassifying the gain in the first quarter of last year from Ford’s investment in the electric truck manufacturer Rivian.
Ford held a roughly 12% stake in Rivian when the startup launched its high-profile IPO in November. On Tuesday, Ford said it expects to make an $8.2 billion gain on its investment in Rivian. However, Rivian’s stock price has fallen from its IPO price of $78. The company’s shares were trading at $60.36 on Thursday, meaning Ford’s investment is now worth about $6.6 billion.
Ford’s plans for 2022 include increasing production of electric vehicles. The company expects global production capacity for high-volume electric vehicles, such as the F-150 Lightning, to reach at least 600,000 vehicles by 2023 as it seeks to catch up with the leader of the Tesla segment.
In the fourth quarter, Ford saw strong demand for the new Bronco SUV, the Maverick pickup, as well as the Mustang Mach-E. The Bronco and Maverick were crowned North American Truck and Utility Vehicle of the Year for 2021, which helped generate additional interest among consumers. Both award-winning vehicles contributed to a two-point market share gain in the United States, making Ford the nation’s top-selling automaker.
The growth of Ford’s business in North America illustrates how the company is winning customers with popular new models. Ford CEO Jim Farley said “without a doubt, (this is) the most outstanding product line I’ve seen in over 30 years in this industry”.
Farley’s optimism will likely continue into 20222 with the launch of the E-Transit electric van and F-150 Lightning pickup this spring.
With a lineup of popular models, Ford chief financial officer John Lawler said the automaker expects adjusted EBIT for the full year 2022 to be even stronger in 2022, rising from 11.5 billion to $12.5 billion, an increase of 15% to 25% from 2021.
The high end of the Adjusted EBIT range equates to an 8% margin which, if achieved, would be one year ahead of the company’s previous target. Adjusted free cash flow for the year is expected to be between $5.5 and $6.5 billion.
“Our team has done a fantastic job working with partners to maximize component availability,” said Lawler. “We’ve allocated these volumes to new in-demand vehicles like the Bronco and Maverick, profitable models like the F-Series (trucks) and Transit, and customer orders.”
Going forward, it’s likely Ford’s new electric vehicles could lead the company’s transformation.
Orders for the new EVS made Ford the second-largest seller of electric vehicles in the United States in 2021 behind Tesla, which Farley called “an important first step in becoming the true leader in electric vehicles over time.”
“Financial performance is obviously critical,” Farley said. “We’re also proud that customers are seeing how Ford is taking electric vehicles mainstream and have already ordered or reserved more than 275,000 all-electric Mustang Mach-E SUVs, F-150 Lightning pickup trucks and E-Transit utility vehicles – and we’re breaking the knots. constraints to deliver each of them as quickly as possible.”
Ford, however, lags behind Tesla, which sold 190,393 Model Y crossovers and 121,877 Model 3 sedans in the United States in 2021. But Ford has a chance to gain market share once F-150 deliveries Lightning will start. The F-150 has been America’s best-selling truck for more than 40 straight years, and the electric version is poised to become a big hit for Ford.
Last month, Ford announced that it had received many reservations for the F-150 Lightning pickup that it doubles its production to 150,000 vehicles per year to meet the demand and reduce wait times for customers.
Ford had originally planned to produce about 40,000 F-150 Lightning pickup trucks per year, then expanded it to 80,000 as the number of customer depots increased.
Farley said Ford will double its global electric vehicle manufacturing capacity to at least 600,000 by 2023. Ford’s goal is for fully electric vehicles to make up at least 40% of its product lineup by 2030.
Despite Ford’s positive outlook for 2022, shares of the company closed down 3.6% at $19.89 on Thursday.