Semiconductor shortage causes 2021 earnings to fall below expectations, but Ford forecasts improvements in 2022.
Ford reported “solid” operating results in 2021 despite the ongoing supply chain crisis, citing demand for its new pure-EVs as pivotal in its bounce-back from a loss the year before.
The company’s $17.9bn (AUD$25.3bn) profits on $136.3bn (AUD$192.7bn) of revenue compares with a $1.3bn (AUD$1.8bn) loss on $127.1bn (AUD$179.7bn) in 2020, when its operations were throttled by the pandemic. It finished the year with the best financial results since 2016.
Chief financial officer John Lawler said: “Our team did a fantastic job working with partners to maximize component availability. We allocated those volumes to in-demand new vehicles like the Bronco (SUV) and Maverick (small pickup), profitable models like F-Series (trucks) and Transit, and customer orders.”
Ford worked with LG to boost battery supply for the Mustang Mach-E, with capacity expanding three times over the past 10 months – and more than doubling compared to originally contracted volumes by the end of 2022.
The brand was the second best-seller of electric vehicles in the US last year, which CEO Jim Farley said represents “an important early step toward eventually being the true EV leader”. It has received orders or reservations for some 275,000 Mach-E, F-150 Lightning and E-Transit EVs so far.
“We’re breaking constraints to deliver every one of them as fast as we can,” said Farley, vowing to boost EV manufacturing capacity to at least 600,000 units by 2023 with a view to achieving a 40 per cent EV sales mix by 2030.
However, the positive full-year results were tempered by Q4 earnings that fell short of expectations, resulting in a 6 per cent drop in share price when trading closed yesterday, according to CNBC.
Lawler said: “Some thought we could do much better on the volumes. But due to the supply constraints we realised due to omicron and semiconductor shortages, we weren’t able to exceed the volumes we had guided.
“Look at where we’re guiding in 2022,” he said. “It shows the strength and the momentum of the business.”
Ford estimates a 15-25 per cent increase in pre-tax earnings in 2022, to the tune of $11.5-$12.5bn, with sales volumes increasing by 10-15 per cent.
The company’s most important launches in 2022 include the E-Transit electric van, which is confirmed for Australia, and F-150 Lightning electric pick up.