Log in
Log in
Or log in with
GoogleGoogle
Twitter Twitter
Facebook Facebook
Apple Apple     
Sign up
Or log in with
GoogleGoogle
Twitter Twitter
Facebook Facebook
Apple Apple     
News
All NewsCompaniesIndexesCurrency / ForexCommoditiesCryptocurrenciesETFInterest RatesEconomyThemesSectors 

Ford shares fall 10% on warning of higher inflation-related supply costs

09/20/2022 | 10:48am EST
FILE PHOTO: Ford Motor Co's logo pictured in 2019

(Reuters) - Shares of Ford Motor Co fell 10% on Tuesday after the automaker flagged a bigger-than-expected $1 billion hit from inflation and pushed delivery of some vehicles to the fourth quarter due to parts shortages.

"The inflationary costs are concerning as they could persist into Q4 and 2023," Wells Fargo analyst Colin Langan said.

Ford's preliminary third-quarter results sent shares of rival General Motors Co tumbling 3.3% as some analysts said it might take more time for the auto industry to recover from chip shortages.

"It appears that across the industry, chip and components shortages may be improving at a slower pace than anticipated," Deutsche Bank analyst Emmanuel Rosner said.

Electric-vehicle makers Tesla Inc and Rivian Automotive Inc slipped about 1% each in early trade.

Ford also said on Monday it will have 40,000 to 45,000 vehicles in inventory lacking parts. The company in July had outlined a $3 billion hit for the year from inflationary pressures.

The automaker's outlook also comes against the backdrop of investor worries that the U.S. Federal Reserve's pace of interest rate hikes to tame soaring inflation threatens to tip the economy into a recession.

Ford, which is set to report third-quarter results on Oct. 26, however, reaffirmed its 2022 adjusted earnings before interest and taxes forecast of between $11.5 billion and $12.5 billion on Monday.

It was unclear if chip and parts supply will normalize by the end of the year, Deutsche Bank's Rosner said.

Ford's shares were trading at $13.52, with the stock on track for the worst day since February if losses hold.

(Reporting by Kannaki Deka in Bengaluru; Editing by Shounak Dasgupta)


ę Reuters 2022
Stocks mentioned in the article
ChangeLast1st jan.
DEUTSCHE BANK AG -2.14% 9.905 Delayed Quote.-8.13%
FORD MOTOR COMPANY 1.29% 14.08 Delayed Quote.-33.80%
GENERAL MOTORS COMPANY -0.10% 40.43 Delayed Quote.-30.82%
RIVIAN AUTOMOTIVE, INC. -1.75% 31.48 Delayed Quote.-69.10%
TESLA, INC. 0.00% 194.7 Delayed Quote.-44.73%
WELLS FARGO & COMPANY -2.25% 46.87 Delayed Quote.-0.06%
Latest news "Economy"
05:57pU.S. Fed policy now more hawkish than policy rules suggest is needed
RE
05:52pWall Street takes a breath after Powell rally
RE
05:52pCorrection to Financials Roundup
DJ
05:51pAustralia's Bigtincan gets $300 mln buyout bid from PE firm, shares jump
RE
05:45pSpaceX gets U.S. approval to deploy up to 7,500 satellites
RE
05:43pFtx founder sam bankman-fried says he was pressured to include f…
RE
05:42pU.S. appeals court reverses appointment of special master in Trump documents probe
RE
05:42pUtilities Flat on Cyclical Bias -- Utilities Roundup
DJ
05:41pCommunications Services Up With Risk Appetite -- Communications Services Roundup
DJ
05:40pTech Up As Treasury Yields Retreat -- Tech Roundup
DJ
Latest news "Economy"