F - Earnings call transcript Q3 2024

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, everyone. My name is Layla, and I will be your conference operator today. At this time, I would like to welcome you to the Ford Motor Company Third Quarter 2024 Earnings Conference Call. [Operator Instructions] At this time, I would like to turn the call over to Lynn Antipas Tyson, Executive Director of Investor Relations.

Lynn Tyson

Thank you, Layla. Company's XXXX Motor Call. Ford to Third Earnings Quarter Welcome and Jim John With are President CEO; CFO. me today and Farley, and Chair Lawler, Vice Credit. today CEO us Cathy Ford joining Also is of O'Callahan, discussions Today's non-GAAP some references. include to the U.S. These are most reconciled comparable GAAP measures deck. in of earnings appendix the our

the with the find materials our rest shareholder.ford.com. along content important other at deck can of earnings You and

are significant EBIT, discussion basis. included are results from those differ also results Actual may actual Unless XX. includes Our Page free an year-over-year. cause The on forward-looking flow factors most otherwise expectations. to comparisons adjusted could statements on are differ EPS, about our all cash that stated. noted, and Company

Lastly, fireside Global Automotive November York. VP Levy Sherry I'd IR House, Barclays out Lawler, chat near-term at will the CFO, key engagement. XX, in participate in with and like Finance, On Conference New Dan a to Vice call and a John Chair Tech Mobility and

the turn I'll call Jim. Now to over

James Farley

billion a we China. key Hi, start billion so of and joining Thanks, positioned were our Collectively, is operations for commitment and restructured Lynn. strength burned those ago, you full creating overseas regions take $X.X overview and versus I to footprint John outlook. Several like cash. you for will year through our of Ford. in shareholders. and to adding South in years areas, in an America, thanking we value key in Europe, $X.X and to why I'd the global losing by QX competitors want We results and India, restructured on XXXX, touch their and Ford+ our and global strategy for we're team today. us all our for our everyone, believe and thank the to well

but continue speaking told in facing major of Now we've on you. stay of be team gone laser-focused and asset-light those OEMs, as are as to couple going especially to for China. And regions other by we've international collectively cost all restructuring getting a our a We're leaner won't company, profitable. of distracted China, years,

strong and have have growing JV business. a We we partners export

and over the In its year. company's China fact, are million now $XXX EBIT to exports this contributing

no Another pressure. In roughly of North hit competitors. overcapacity, $XX has early. volume in and at be is a We've No customers, X dynamics means any have from compliance immune. fit moved trade U.S., our total to EV for in of a nameplates the lot progress strength flood end a of year, price global America new expecting strategy, by and That last to EV area new is the by XXX our billion. global which XXXX. Since We compete. on market while wouldn't requires nameplates prices. it's home learned of OEM the been We're the what I Gen grown flat our fueled EV to QX doubt by and are volumes there's massive our XX% revenues offset on war it fully EV of market

credit. market manufacture getting tactics X our our by lease Chinese consumer future. billion focused of We're these are in remade designed focused XX% we're of brand-new cost has launches, the within We out by years. dynamics, batteries, be capacity got are And BOM How to of one emphasizing for new midsized and few we're in our -- have we production excited It the manufacturer first think I've most already we cost. vehicles. the in be huge risk know and costs seen the of that the next-generation We in on years deep about line shifting market and in of design our even do electric first XX%, Boy, our resorting will products, EV already we We has auto with engineering on the we LFP. battery in of that? accelerated the the our on mix Because months. products. about damage. What team doing residual lot coming reduced the We've brand aggressive we our year. game-changer a of trimmed years. In segment a IRA battery well, U.S., XX a and We'll will where the in leverage tax But California incredible into to exciting. an portfolio our matches industry, package been competitors creates to the resulting It's the very which we're some this EV $X well. these the already their overhang in in profitable be Mexico building structure the the And quoted. products technology few in do XX next know any pickup footprint.

revenues. product have key our well Pro, combining reached what we product repair for our vehicle the software on network, one commercial as see is services. And is Don't commercial advantages. confused obviously, advantage network an a and a and as other customers largest Ford the our Another that's together. to gaining It's software we our linked all ground to strength competitive rates unique incredible by press attach of the our that In It portfolio, Pro. releases that U.S., us, of is services, advantage. driving turns strength because services drive market the also because out those in software sticky be in all with leading we're essential game is dealer portfolio, high-margin repair reoccurring in have

our growth rates, our margins base, There's upside at and revenue, subscriptions XX% incredible quarter, in of a software Ford paid are XX% gross our this grow for XX%. and installed over just ARPU. delivered to Our attach

powertrain Another lineup. our strength diverse is

back, leaders advantages the bottom significant a held back our years step they're upside home our brand. earnings than XX% but line strategic we has up. Interestingly, financial A in bend take is incentives to is shunned and tied of the falling of managers they market, in going quality, Taking of scrambling, our at design, example, the to catch doubled long-term X the By and to and half #X market EV U.S., TSR. our pickups. lot and have Ford more warranty, the as sales companies ICE bonuses XX% the For now brand, way hybrids the curve, Costs, investors. is #X but hybrid #X the now power, for cost for them our are clearly, as especially the past years. have to should. to pickup it's there nearly hybrid in that more than tied is brand, Ford hybrid not our We a share of

on business. me Let $X,XXX per unit. Mustang the early on EV the we've Mach-E double-click applied across In XX that lineup. our reduced the cost months, we lessons learned last really Mustang by We Mach-E's

segment call second we've were the know, to sold profits Power of for We're to our we and to being they in the mainstream Promise. of by Supercharger are Hovik U.S. vehicles, advantage for friction complementary being or years our example, about is huge network. one charging team end offer competitive first market uptick are are XXX,XXX becoming to adoption a not several seen the adapters the in Arizona Y Tesla on the Network, customers. XXX years. in Model with Power quarter, we'll sales installation. whole be And building our you Tan dealers. first home for Ford it prices at for break the to website solid in the We last dealers and months, year. We And and and But we ZEV And Take, dealer this the shipping Ford from Mach-E on also the know-how interest transaction Tim a state. As the the that the is mainstream couple despite Promise. his These customers. down barriers continue In of San for and now for ICE #X a incremental Arizona. for scaling and across gross in sales electric join

primed now. our of to EVs sell X,XXX dealers All are

and specialists been hours XX,XXX now. on EVs dealership We have trained have spent X,XXX EV

Our dealer fast are the the installed and many chargers and more XXX network across Canada has already on U.S. way.

expect the for the whole. trading economics credits. company wooden Model as company of inside emissions change cost, we and our EV and a through to the trajectory we're of nickels improve won't not year, That scaling, the business e's Next vehicles

Transit Turning We're by between points starts OEM our Pro. That's customers having a now segment the of and quarter. up vehicles are leaning to first percentage electric lineup year sales And the commercial. ago. future. a to X.X X% from retail About it product into the in great and

is services unique customers. about and XXXX. value Pro that any more OEM, other What We now or and mean Our of by think I from to that has XX% to repair Super EBIT Duty services our than software. our about comes for provide for we're bundling XX% vehicles will grow by variance

We have bays on network by add mobile way, is the the this commercial in X,XXX service North America. XX% units. service up largest year and service track That, X,XXX over to Pro year-over-year. We're

year-over-year Ford orders have X by XX% about almost We repair XX XXX,XXX now subscriptions the truck. Our Pro service a in mobile rose repair XX% Intelligence are and Pro of orders Globally, up now done out mobile is subscriptions. quarter.

with demand seeing but and second in Demand was line Super for product, offer limits more that's Yes, including pent-up our that to third-party the Blue. acceleration. consistent a because vehicle to our for our then top and is As features we in Duty said, and more Ford and with can half, on functionality unlock, adding pressure We're more cabin companies wagons. And expectations. growth seeing tied product XX%. We're of year. that chassis I pricing guidance Transit the the lock revenue remote Pro software it's also are speed original

that Let me double-click second for a on business.

add First, fresh we're lineup the and to going globe incredibly that. to across we have an

fresh will Expedition product, X U.S. points derivatives The was our new basis quarter the the in have be In with U.S., in deck. We on we have Bronco to Navigator XX all-new year. and a launching share QX an up launching and key and new Maverick next XX.X%. fourth early launches

brand September the the Our the in were higher nonpremium average with and Ford ATPs transact in brands. to than line continues industry,

Now but is We XX our That's quarter XX dealer target ended days range than days, a with higher of me good. stock days let of really the little stock. XX unpack the inventory. mix the to gross and XX of

during the some these extra I holding as sales us opportunity inventory XXXX metrics really biggest The the target warranty. for for cost And things that, that improving. that launch year-end from is we're biggest right protect we range mentioned. standpoint. The of realize intentionally And to through adjusting and input QX opportunity of are is We're warranty. here's side will the both attacking on and company evidence the clearly upside. we we're the start inventory the Now activities an for in

MIS Escape virtually X X launches increase a and years. Our quality XX% the huge had really high-volume vehicle a no lot sees defects better, increase launch. getting XX% had no a service in in a F-XXX or year, last months lines the X Powers in is J.D. typically during This spike. warranty and like

also these from cut losses like been F-XXX Explorer. in large-scale very Our have production half launches year, are last launch and the and

believe Another update cost We've and, we're for field. sync the OTAs, OTA a million XX our the our of months, our inputs. Taking modules. seeing We well to infotainment very and up Ford needle time on vehicle OTAs. warranty all in warranty. at X to improve the expense, key position. ability beyond average, the course, moving All is doing of we our a on save modules, it maybe can improvement improvements warranty customers and million started we're X repairs step year reduce now total The vehicles but lowers updated to I and XX that to since XX take we're to in waiting back, X different this our competitive strong will vehicles days

have a with international no profitable and distractions. business lean We

We even have appealing lineup get and fresh fresher. which a will

term. couple second our X of strategy We're They'll strong have on in electric and Gen We the us launching generation the reach. be vehicles. products on up already in competitor powertrain a to and long years. and global our short term the a We'll gives customers us losses gives reduce that be of diversified the flexibility set next choice and

We and the to capture doing We're the to repair and present for John? have to and a yards for going home and our for going hard Pro growing a in cost clearly valued bring warranty upside advantage business Pro, investors. vibrant us, strategic keep to defects tremendous company. software the it is we're

John Lawler

driven slowly top the in and also is surely This benefited have consecutive $X.X including in and segments XX% offering, Overall, XX%, ago, it a from of mix, changes choice years cash launch pressures as quarter, revenue our our XX to retail plan that Thanks, are tenth and consistent know held freedom global year and product was evidence both flow and exchange. while consistent restructured In the but were that behaviors focus revenue the X.X%, above quarter quarter. I growth. than Jim. customers. has delivered well driven billion by over by with working. Adjusted growth. our of commercial lower truck billion. from That's X% in Aviator. industrial $XX ago, strong EBIT customer billion Explorer our third the higher EV product we The us grew wholesales was we quarter range of lineup confidence today's $X.X well by improvement adverse supported costs have free flat targeted shedding in, and our year-over-year to We of cash our on lineup as conversion years hybrids of our improving margin is business We're compelling by adjusted is in Lincoln XX%. favorable cash Ford+ Several the of to all-new past. a quarter our few flow the great a Ford billion line system and best basis were and the proactively $X.X and which with ago. underway. up in expected points year-to-date more back volume stronger And offset partially lead tailored all just pricing and to that free Profit sales,

remains $XX sheet balance Our billion billion and strong in with liquidity. $XX almost cash in

flexibility share prudent have this is We that on and continue execute next that time quarter of flow flexibility to invest and to XXXX. opportunities build-partner-buy XX% us $XX also maintain hand this economic growth, our shareholders. We return shareholders in it we fourth cash to regular including over $X.XX have out today's during X. strategic November shareholders of the accretive to X pleased announcement declared dividend per since that during billion on of in to to financial cash to provides December record extra on payable of the believe announce free paid to target cycle. I'm industry Annually to unprecedented XX% adjusted beginning

turn to me Now segments. let our

in X-ton quarter robust close Wholesales billion Pro for delivered of by quarter, growth. Duty X% all-new a of the launch $XX vans. year-over-year billion in the was Transit aided another Ford healthy were to margin with demand revenue of up the of EBIT of and Custom XX.X%. XX%, Transit $X.X up up X-ton and Europe Super

and to revenue. long-term ARPU underscored performance Pro monthly consistency were their in our margin for with this subscriptions, year-to-date in our to Ford up line demonstrate the attach Paid EBIT quarter. Pro's sticky, of be target. high-margin business, noncyclical rate, growth and results continued continues resiliency XX.X%, the higher-margin of prototype by

cost were We delivered XX%, partially $X.X in of Europe. loss a all-new down management by by dealer offset EV launch wholesales $XXX balancing generated of on the and improvement, our Explorer pressures. billion. industry million was yield focus inventory America, pricing e North Global offset Model which the Ford in reflecting of year-over-year

Our team equation is we head to profit XXXX. Gen our driving further reductions, outlook on delivering optimizing X into cost helping and focused capital improve as the efficiencies, market

ICE the in X% was vehicles. Blue quarter discontinued were X%, Ford up down passenger revenue while by driven low-margin wholesales

both by like higher America X.X% due Although to EBIT costs, offset down shine, by X expense in the X%, overall adverse and still of pricing. Hybrid up volume volume year-over-year exchange on way. was and XX% and key on and down, margin $X.X warranty manufacturing the partially by global of products is billion year-over-year more driven continued North our over quarter, was F-XXX Ranger. nameplates approach to mix up sales up to pace higher year-end, hybrid X% net and lower with points were

margin improvement values normalize and generated by continue Credit lease historic in Ford rates an to Auction lows. declined $XXX financing return X% from driven million year-over-year, million, up EBT of and higher receivables. $XXX

XXX a to retail quarter. U.S. the score, high-quality again, book and continue lease FICO exceeding for We originate with

EV in our is with to exposure XX% the U.S. less risk Our EVs than of portfolio lease representing residual low,

outlook. first the nameplates resilience key strength of year we delivering through year, X the to to full we our turn has expect our let's $XX expected This of to then, commercial business speaks company portfolio billion. the fourth and So continue our favorable of months When market Since $XX the expectations, to adjusted product and our year, quarter. began the this of billion the exceeded EBIT Ford factors, trend mix Pro. our at including we in

on cost year. our offsetting also expected track of costs product billion within for deliver platform, refresh We higher to are industrial labor $X and efficiencies the

gating warranty of in the of increases impact us a X JV, Otosan However, costs this Transit Ford higher-than-expected year: from cost adjusted sold which keep at factors our in inflation and Europe. record material EBIT Turkey, vans the

full While Turkey for are In see general, lower-than-planned the warranty inflationary of $XX and control, adjusted of control. costs for disruptions. within in We our about due supplier vehicles is our second Pro year pressures supply which in Ford balance. company now to in expect outside we volume increased EBIT half Ford and demand includes Blue billion,

expect $X billion $X.X $X.X $X.X with billion between flow We to free billion cash CapEx billion. continue to of to adjusted

to Our in slightly higher the U.S. outlook Europe. for 'XX flat assumes a SAAR and both

the Our pricing Ford better of contributing million is demand spending planning U.S. exit incentive year year. industry XX lower we market as XX.X Duty the X%, Pro, million higher assumptions factors units. Full to driven by for customer roughly Super to for for of

of launch our growth we Ford, new be to products. partly the this top expect For by offset line from

of offset products. guidance on with an An cost improved balanced billion our Blue, market which lastly, market Ford efficiencies. be double-digit e, about equation partially investments new our Model in about of now Ford now is of were positive pressure billion a by a cost in anticipates We $X driven Our over continued costs, equation, and and expected pricing expect improvements reflecting $X EBT growth for segment EBIT about range, that manufacturing continued by of And $X.X expect in by Credit's core billion, the continued Ford we billion higher warranty partially vehicle loss including strength EBITDA offset Pro. year-over-year. $X outlook platforms. for pricing $X end strength And product and billion, will

this right plan, product our positive our consistent quarter reward and the portfolio, the generation Ford+ capital performance progress demonstrates discipline, shareholders. on Our cash to

working make We remain are better, we prepared balance to address remarks. relentlessly of That questions. on both quality our and wraps the We'll up focused business and to improving our time the use your cost.

Operator

Our from Goldman Instructions] [Operator with Sachs. Delaney Mark first comes question

Mark Delaney

Pro was margin fall the to led EBIT quarter. intermediate the Maybe year-to-date. Pro can strong EBIT in XX.X% more the term? moderation but although quarter bit confidence in you in around longer mid-teens during gives in to over still at segment XX.X% the Pro talk what the you that did a And what third to EBIT

John Lawler

Yes.

at seasonality saw is we So we're the in last year, year, look this when like what you it, seeing second quarter.

Now the the business. the we falls That transparency see And in there's quarter. peak that off rental in in first have quarter, the past. commercial business around second didn't we

we business. quarter, X third quarter, this fact, had In rental basically

can't you're Duty see run as up at we said, in for continuing we we're and see, in seeing units chassis that's Super Transit, Ford we see so Pro Jim capacity you EBIT and other that the ongoing the the And shutdowns strong to the especially we seasonality as our The half them and is full make the at wagons. things have up. see lose you we half. plants. second see in And second these our we at the and the demand thing show then know, we is that those

pricing held strong pretty Our this year. has up so far

concerned not as are this seeing move still that seeing but model we're we the pricing something we're vehicles we're so line We at top pressure what 'XX the about with some with based far on years. point continuing forward. And model 'XX year to it's expected,

to that, And I process gain their continues going productivity, So be right? the that of improving come customers' we're traction to about selling our you selling we're business our along market. how would again, that to improve helps giving them them along on profits. We're strong. tell solution, the the really business the overall which And services with starting that's vehicle and with we're

and a continued So leading all that's Ford strength it's Pro. coming of together in to

Mark Delaney

had X either for around I or just Model e. Jim, you for

just improved during e EBIT the us think for broader taken actions EVs of I Model cost some improved and think Model you capacity next requirements trajectory e risk Model segment. the company impactful trajectory as be help EBIT And an Maybe trajectory? within better the how be the year. your the said recent prepared within understand you'd pricing expect in much of might rising e, how can you a you has improved that within Europe within your about outlook might environment COX for and remarks

James Farley

becoming Thanks Good starting in they're of a positive EV to scale our contribution we're mix those news for vehicles and are your bigger Europe. business business. question. And margin is

getting from first we're cycle cost-down We lot are made to We've on progress efforts traction a of and focused on And of Mustang more we Mach-E. lot a really our have make. products. definitely our

out. And I for our competitors the enormous to on think our And we're think we the prepared segmentation benefits tried this that. one it, OEM of growing percent. have like no broken of So having the XX-plus risk is about mixes, I seeing and lease some comments is highlight immune pricing, doubt said, in everyone I no of to as

play that you pressure out, a said. will Europe, There's as So Europe. especially in lot of in

a new Anything brand help John? next Europe products so Our will in thing that's good year. us and else, that are

John Lawler

pricing said, around going us, the have Jim, as California to the team for pressure. the line in frame the to as helped having going it's up marketplace And really long -- that's that's generation top focus hinge continue all the and generation. have, we're be And on to just you cost future to mandate what current in improvements we as I No, we think that costs on that been competitive.

James Farley

cost, following credit lot the That's really in the Yes. be on of levers products. a to specific And first-gen progress year expect the next key for our and one years, of for we really the production us. tax

able of a where the PTC, the from, we've sourcing existing been who all to you'll our products. them year they that that way our of and quietly next come to As drive cost lot down fruition come mid will XXXX. maximize for through restructure batteries, makes starting to pretty see really our in and And

Operator

from Murphy Our with next question comes John Bank of America.

John Murphy

positive Or of we've the we're warranty is -- issues the I particularly seen Just a first and on bell some for of you're good question curious all And ring through the kind clear other past, pretty the in mean, of of of some sort this? data maybe what J.D. worst certainty there point, just sources. the on now this warranty to, that of you. quarter. kind at cited we're I'm last positive that the of for around kind some both if you alarm willing Jim, is Power, But

John Lawler

Yes, John, answer could I I wish certainty. that with

We indicators, months are we're leading saw 'XX the than 'XX. physicals, model service over we year XX% seeing there, and around especially the in X 'XX in our what improvement seeing better is

basically one. launch we spikes, Jim on As Explorer didn't mentioned, Kuga, and our see

overall from standpoint. are quality indicators going that to good So those better an are get things

for working to at the repairs current off read we're not on at and those. fix And of models things we could of fast and take to on it's to and get from the I that time best out plants. I as we front I doing and going hit us? as Now satisfactory can't everything it's do standpoint. is you looking our What guys, can't possible, we're older a to out any to tell we're can. this, cut there know potentially warranty OTAs, all any that What issues everything the looking models. try flow through the data don't increase are to is FSAs the in can in can We're we And you get through out for the

you curve start So and right there things to sure figure is cost can't and from to I through think around the that. a that everything we're for out that's get a and And doing the standpoint. we I that clarity can going standpoint. understand tell how bend physical from just going to and all when transparency we're doing flowing

John Murphy

just third around still, broader a net pricing. the and the although then you've but And in quarter. mean, it sounds market. what on I lot also question question, positive might basis, concern in happen like that with might going in A it what's inventory around Blue, -- your a even of second inventory, answered was on

actually even look a for have of keeps forward you relatively think and and So How it year got I positive worked next at mean, I mean, out into as surprising about this inventory you you guys. and like think and being seems you an that the out. you now be product do pricing, coming resilient about pricing going you've great in the offset. It industry? should bit

I how do forward? about think you that mean, So going

John Lawler

Yes.

relative pricing were had and top volume, a So us both year, is X%. thought. industry The to this line, what for we down tailwind

come we end the quarter, standpoint. We the through QX as from a into are pressures line top increasing of seeing

share happen is to sales issue inventories? Yes, inventories good and competitors are an higher is guess as gained Your but of and in with what's increased. deep also John, how go as pace our quarter going going we our the that mine, were some to have our

XX of we we're expect. to We think launches We've got rate a run the back for get will to But year, in XX inventories. that do what to days year. get QX we we got carry our so end vehicles the -- to a plan some within some next So manage have plan to we've we sure. the higher inventory for through plan back to run those rate of

bridge into now As XXXX, under there's the year. lot the between and water of still needs end of we to move the a that flow

about you I the As One I we through the end up that. want seems is call bit up is on before watch And pricing many got held sales fact heading said, pricing at year things can year. what next headwinds? of of consumers how of less, I going a coming into we've see run all going is how are been that that to looking you pleasantly the in we that spending is we've are And back cyclical to how with and guys this written to so we surprised along, think happen at show far. how it's so you the the the XXXX? pulling any But give think to year-end in is we're have quarter, Europe, it they're

James Farley

And add pricing on is really the only thing mix. I the the would

continue We move of utility. we're be customers the change in seeing into Affordable to to mix. really even some And small side continue fuel growth. unit EVs series see

are those next well. at for us to the mix the But year. the not of look the truck to at is the that uncertainties really segments discounting or I encourage holding segmentation. just all are look and good we The but So have top just news up line and the handicap segments Pro also all

Operator

with Adam Our comes next Morgan Stanley. from Jonas question

Adam Jonas

on any break or reverse as even kind of results geographically, in have world the Chinese exporting be Europe you much was that know contributing of color to this in wanted of versus I'm rapidly China. market you've I your highlight? regions seen. you curious how $XXX from And seeing So mentioned you in rest from that was year. world domestic out I growing to impact results Europe rest was really and the specifically, that million China been of but might you any don't competitively surprised

John Lawler

start I'll think Adam, that rest then cover question. the of with Yes. your will Jim and I

in million primarily in and total Asia our exports profitable to Jim China South profits, of $XXX includes in and itself So China. mentioned of that the rest we America. are of and

then Ford to primarily going our well rest JMC South And China. asset-light JV profitable or the America the driving as exporting significant stay us is allowed Blue. has So as within in and profit Asia vehicles strategy export from to of those

James Farley

for product Adam, us. globally, key And for such revenue a become Ranger has our

the #XX. why When And We I are is so of in markets company, Ranger. Ranger was we're because so many many in overseas in came markets. those reason the profitable

Australia, like markets, Hilux. And to Now we many outsell Toyota we're them. #X in

business pressure is of great in localizing and to Ford's So pickup XX% with in They're Thailand. products where up revenue. Great going multi-energy a of MAX in including all sharp there. you We a thing focused good passenger Europe. Wall now our really that that's offer the customers where in Transits China. the but bit they is great a They're for market strategy for almost as we company market U.K., In want, the Pro Transits, have compete compete whatever don't on our of that. value XX% impacted we little Europe, major really the really the commercial we don't I we business. The the in is they We electric Chinese has really strategy it. for that's can being is there so movers. products. a been have said, as the But we proposition but Europe, commercial Pro see said great haven't see car where show in

Ranger for I we're both Transit. think, and well So in positioned locations

Adam Jonas

cut you year the John, about outlook. $X follow-up, full as billion out Just a of

by You segments, wondering provide You but costs I you I you as expectations? your compromised shortfall down if your thought. are your mentioned if as gave the reporting down that much break factor by not could warranty $X you billion what costs but versus detail was

not I to if by or and mentioned causal that missed factors quantify other any the disruption, you supplier you FX You're some satisfied. could know wanted factor. units. you

John Lawler

Yes.

we QX, you And in standpoint, what hit think, a Turkey. hard had year the where we in costs I got guiding us down warranty it, you've when look the versus right? from on headwinds are seeing at quite got inflationary we in to look had what now to full and QX, Adam, we at we're it relative

on the fact you full and what's from the gating hitting year, we back are just from talked we step positives the and mix we us those headwinds a offsetting the record is had volumes the that profits stronger So line that we if top just pricing than expected. have that about,

gating most with we're our is to and profitable we're some is due us what of profitable, hitting end in we Now the missing lower seen then, now quarter, that the second coming volume out some suppliers. seeing, constraints have it's highest of we've to mixed and And some particularly we're range Blue, vehicles. our mixed which seeing headwinds since

by hitting the that what's that also some does down We pulling it? we work that is have a trying of Blue that but that the versus believe their hurricane, Does productivity to through what Ford we'll Some certain that's standpoint issues through. a production due some we're is explain we that lost to with be cover on but quarter, supplier end and of at the Blue Ford now from we -- guided QX.

Operator

from Our next from question Roeska AllianceBernstein. Daniel comes

Daniel Roeska

little back stones going I'm about if the step EV remind give the about view here kind slower the stepping we've somewhat and of discussed past, in think targets bit not what in we've the term? could you But to you kind in the into past. how your the performance might medium of Jim, take a us you in hold for and also of 'XX. talked on to And Maybe a XX% us still of transition kind of Ford+ impact

James Farley

we're reacting and to Well, is need focus maybe we our the of little -- our opportunity. And cost what approached changes that Thank make industrial have our of proud at system, looks progress in we going of I'd lot systematic satisfied all. the into in the at competitors be I doing been our really really we not is always And but like warranty, And much environment, made have would Many has the been slowdown, we company. of out. I'm that's really out. us pricing that tougher coming journey we're lot quickly second-generation team of upside management that is as And for team will coming work. those rewarded to products interesting all a really say a it. EV models the our and FSAs. biggest and at focused Ford. most bit a of coverages I'm a that's market it a as a focus home you. still the because looking to work proud cost the That say our continues and certainly, and be early as for on adjustment

that's we and that's products. way second-generation or X-year to vehicle design we the X- all think the is in learned fitness for have addition costs, industrial and our Ford. a design have In advantage I And manufacturability, the the that, designed, for the really to

expect across electric was team we'll on of can our the The innovate offer Most reason more Pro I with us And and popularity this kind trucks. about other we which a onboard don't for can't at fantastic power over-delivered, revenue of competitors the frankly demand. And that would the using and other hybrid opportunity put on the especially why hybrid hybrids about. you just maybe the because our we been other of to emerged of opportunity customer hybrids, efficient on has We I to we keep lineup Maverick. curious us. whole partial truck be more focused hybrid that has for didn't is up say an or in a a solutions, And has advantages the propulsion. least that platform. design encouraged than talk the think F-XXX skunkworks

I to the more of a to and been vehicle. is kind us advanced of the just that's BYD. aftersales really journey auto like itself, actually uptake OTAs. show am that, Electric big really to make the important to and slow we compete it say EVs. production. And everyone focus of for shows capability to be industry been but of going on attached more generic I because do with would the software know-how. need more a productivity Ford I And company. their electric quality, for to has some like the a cost there's not is future it kind can Now think architectures. But high-scale already are the company the execute. shows and We're challenges so to vehicle services, excited interesting million repair Pro a because tied software hard work with the have with journey That's to it we and The company how that for architectures company And beyond and software and technology obviously, software at XX tied

been really positioned there I -- and midterm. I the in surprises, said, we're well have but think So we're as short

Daniel Roeska

Great. And follow up bit. to maybe, a John, little

would the of the going short of certainly ask, there's headwinds of or stability [indiscernible] increase just I and seen in bit to take But distribution? Because would isn't summarize, quite to could distributions, If what's shareholders? term. the strategy to you can let's allocation make you right? move could on fast again, shareholder look is buybacks, on little push you, ramp-up as you're of those be dividends factors its EV happening maybe bit But been to distribution kind more cash on the kind to other striking? what the what couple some for a kind demand say, dividend actions? or of as a side. so delayed be you aggressive And What balance tilt the that a it your competitors we've maybe immediate a reconsider be capital example,

John Lawler

Right.

to time as -- it's hang think do out XX% about this consistent cash. we're on incremental quarter to in expect. this XX% And to every our So And at we point the going pay to you we're we that in would our prudent talk cash of free flow.

the in happens something would disruption. cash We right to saying billion I'm having saying we be it's think be higher cash. And pleased at have time, I $XX the to hand. $XX this there's But need $X global were that where billion. in uncertainty at the we're happen, industry, the going going around hang point is this in thing now, globe, to on and in that stated And where billion to minimum not very there's we we're economic overall cash not to than the economy. be at I'm in the that right our cycle, some

quarter. that shareholders. we and might back that and facing appropriately handle cash will an will or that doesn't change, we that to cash if look and or environment us we accretive it adjust make we be we that growth it or we pay we every if look appropriately. it quarter at And at risks have either the sure the the invest to diminish every don't the significantly, use that have understand So We a see then for

Operator

UBS. with Spak Joseph from comes question next Our

Joseph Spak

handle I hear some want and and The hard see stronger. business, there. still a actually, it confidence payout you because U.S. on little also you up if about that to just uncertainty XX% the there's pick it's something could we becomes on quite Jim, a talk how hear have on to is this but right the I XX% I bit call warranty there. don't market, to Jim's

how talked free industry downwards, the You working fast capital then stalls pricing maybe expecting cycling headwinds. it's potentially a it, We cash if at out, about again competitor. saw but not not obviously, possible. And a necessarily deteriorates there's flow

to inflation. investment And hand optionality. I for higher want still you some made. on to mentioned cash be There's keep know You

I right like XX% a why And hear like the I'm actually XX%, me to in XX% to considering number? that? is view, of wondering when you that's you a talk retrospective but XX% view much sounds to about even it So prospective how are

John Lawler

Yes.

Of course, the year. we're what prospective we well as for at and look going both pay to out

a good And where the XX%. the -- set the at be, we to strategy what's we front outlook potential potential headwinds, tailwinds, payout we the changing, in see we of to us, potentially prospectively et could the right cetera. look to environment as thought think risks, So around ratio, be now. that XX% And where that's we do point

evaluating it just So we and don't at point at to in announce. this do time, always looking do, we're that. It's anything we're that it. we always But have

would will conversation a the then right And change, you a a make once time, prospective that expect. it's change We feel have on we as outlook. every prospective the quarter we based

James Farley

to optionality add comment don't we're to our services just a all anything optionality doesn't frankly, the for for for mean, have Pro the car business. of XX% but only time. we're company to Pro a of And its and, business a strategic business about revenue want growth or organic just we That is industry. But running our to the John's some XX% a had profitability special going to get moment company have services? to I not for would from to the that really being that I when's come announce chance always such build excited the but services.

that, of thinking takes strategy services. new it to in that services but also restructuring of to we're like I like Sometimes into those going very go asset-light going like choices, our We're we understand have very about what Pro carefully, our and I'm all kinds nurture just have investments like not our want China, Rivian we we way carefully beyond the handled thinking to in today. investment. the how businesses, business you

Joseph Spak

I question just in it a more for said of a -- on model called go last to Maybe billion a is right? I and as regulatory Mark's you second for question, reread to know last $X.X back North compliance. this future European a want pooling I the It's out it's in compliance, bilateral for current Europe morning, XX-Q, -- But years. America Europe, really understanding, for and system my negotiation there's agreement. and maybe no credit it

you number? your et a do cetera, the and Capri, being portfolio year? in between be agreement that pooling potential compliant to considered what's with Explorer, that is next So expect new And

James Farley

think to as in important is, light-duty well It's different. in yes. or very we tend like talk Yes, actually America And consider. to and heavy-duty really thing in Europe about X as that's COX other thing. passenger North to compliance as or Europe, they're about the car, And

on only launched vans. small combustion we're have of so available fully obviously transit compliance new our also -- diesel, whole but and are excited one committed to that's and markets. And one-ton that's about that's of why why both in not line gas, about, think electric. a we we we van, compliant the we heavy-duty the main So have reasons electric just We be to our

ourselves as hope it and comes it's double-click best because standpoint really -- also But we to in the at not U.S. ZEV but well. the actually. quite I an compliance compliance, giving states to at look start heavy-duty chance we're look when it's So offer COX from obviously only different

Operator

from comes Emmanuel Research. question next Our Wolfe Rosner from

Emmanuel Rosner

cost My program. first the on is question reduction

in So cost freight, for manufacturing. this outlook material, year's billion $X still reductions includes

cetera, fourth of next it lot quarter? you're to for still the forward, do much things said et of is opportunity know there's is cost I How if the we what need the them And then year both those. of move you a control, you of year-to-date? terms on in in, in in track like sort volume but much look XXXX? as achieve pricing and discussed you and terms of How into You uncertainty you've detail, in into size

John Lawler

Yes.

brought so the on this efficiencies most through is quarters. through it first far, we've of So X that the year

we in X have most some of So QX through do savings the first quarters. was but it to through come

launch year. that because part with of right, was was changes there the made that Now you the large would model on the expect design Emmanuel, that, a we of

that's So of come most through.

Emmanuel Rosner

go-forward a basis? On

John Lawler

our right you a on #X cost end anybody, is there in that as going unlock our we'll position cost and lot I water, opportunity So you from the give give and guidance going and is identified our as opportunity, in we We tremendous our cost we have aggressively We'll Ford+ of rate numbers of it. we curve there's we that, give earnings you well a said to potential we're of cost we're from and that in not cycle. opportunity how question as and any morning bridge competitive competitiveness competition. a to of pull standpoint as that this your 'XX note, for our and earlier, and given and cost the after have standpoint, now, perspective. It -- to that, into this, know understand that you out. we're going you flow know as as an had But update a of know strategy. QX right? We're -- understand after this relative on 'XX the well the flow what all the at before our this and planning a There's to lot that bend The year.

James Farley

For cycle we a material of made -- a next off our but another we the of as industrial really team, us year focused lot reduction. That We on progress for on finish well. new year this all what we've and as product of a is cost here, really costs. lot added we're is costs material had also opportunity

Ford. we're with looking working and we a to areas. supply to carefully any that we're And year. And of make a costs. is in special at North course, of really and second to double-click looking attention modules enter the team lot warranty, On on more kind Obviously, very cost warranty next we X as carefully cost includes be at team. our on of those on our a have process have competitors suppliers, or will and manufacturing, of freight we work EV dispositioning repairing the them costs spending our rotation duty. And warranty. teams where to the we're our this progress good chain those inflation-related sure software on well focused a be with our and from we negotiations really talent we're our and benchmark have as So we where standpoint, Gen that then that as made powertrain. That's and both requests, do that fair America, We as and time that's on competitive all supplier but dedicated the

Operator

from Dan Barclays. comes from Our question next Levy

Dan Levy

Want up a about that. Sorry to little follow questions line cost. on prior the something ask and different on just

$X You it ago Capital the billion think material the your now, mentioned mostly months at your gap cost on against had competitors, or cost. you XX, Day, XX I discussed Markets that you some was

narrowing when of presented now that You you do that you other come cost $X as cost you mentioned the you that system. confident that think you're getting versus year on just gap? gap that originally the but into can you target? cost billion this Are stand narrow costs had Where today you

John Lawler

Yes.

different the that today and to cause understanding And about issue to that a fundamental system. for root ago leadership I it's really that's where we So a a take going get very position Dan, think as the versus we're what in change been were the of make changes us honestly. XX out cost to months of team,

taken gap not haven't taken pace cost faster we has have. it out, competition. we're We've we our versus but versus out, than say Our not to not at cost closed. competition a cost doing them It's that

had statements made. And venture with through end more that. structural gone but when we've our progress the warranty with go year other costs but K. progress backwards ASP, quarter. it the the at progress of made We've have what competition, every progress We relative the on they've costs. at We of seen We some the with the we've that offset areas We've SG&A versus competitors look on Qs financial because made on in material We've inflationary we business. update largely costs the get the pull made apart costs, joint our sits. we our analysis. more to Turkey have that So

increase So It's still a lowest this cost we business. for. just the strong this planning that it's business. still We've year weren't seen very

So we to driving overall continue move our to to faster, be line. And on structural the to make need bottom warranty of manufacturing big costs. We needs material warranty that. a need costs, part the as costs, costs, well down as progress

that, you we humbling So taking said, closed to despite cost out. be as later, a the in position it's gap is months haven't XX

cost They're are competitors need our out. pace Our thing. what doing competitors same taking We to outrun accelerate are to the our doing.

Dan Levy

the you about on to Maybe wanted earlier a comment, as helpful Jim, follow-up, a That's that that ask skunkworks color. mentioned EV.

where are of a sourcing cost of EVs? the you enabling cost cost-outs you the the think these lower your driving that's have clear on XX% or versus already to achieve what what You Maybe BOM. maybe the of you sort is, structurally is pieces that and material you've quoted give quoting the confidence could industry rest of achievements in because on seen flavor us you've in

James Farley

Yes.

competitive that is supplier an The the word. important. for to part really components, approach vehicle. each And So especially really want ours too of should suppliers, standpoint these of has the or proud we took the detail, do. think really been don't because at on a eye-opening basically us our like really, team have we even that BYD a by an into batteries. and to LFP lot normally get different advantage see And obviously, a advanced we Competitive to than totally suppliers. And of much battery I affordability a experience what of developing I'm key cost is companies X is different incredible earlier design like verified a we from looking it a verified but having challenged variety year on

inverters, gearboxes, supplier. new skunkworks Basically, your the change. And components in the is just at if vehicle, a to the of move is look a answer simplify the a That's actual Like to when of we So have question motors, on side, parts of the component integrate where number you opportunity design component simpler as design better team. Look, high completely to to of that our it's I the think cetera. And manufacturing. make level a the really and on we combination that is et up road approaches you with and EV you a very the the well design of that's a phases seeing suppliers lot we've new hard radically And simplified the the the magnitude out leveraging map lot the to as as get done design using as of front way cost. earlier, order well the progress. part itself working vehicle. design technology up you the we're supplier where cost on of the can it X

a for whole We have strategy kitting vehicle. the new

casting a of stamping have strategy We the vehicle. massively unit the that simplifies

other will typical simplicity think ethos and of an do lot chain the development for broader I I'm of cycle. what a really earlier the higher in with that. seeing But a is companies engagement process a than supply

Operator

Ford you your This concludes XXXX Conference the Quarter Motor Earnings for Thank Call. participation. Company Third

now disconnect. You may

Ford Motor (F) 28 Oct 242024 Q3 Earnings call transcript