NEW YORK—The U.S. automotive industry is back in a big way following its near-collapse three years ago, with Chrysler Group and Ford Motor Co. posting impressive second-quarter profits.
Two of the “Big Three” U.S. automakers—with General Motors being the third—reported solid second quarter earnings this week.
Ford, the Dearborn, Mich.-based automaker, said that second quarter profits were $2.4 billion on sales of $35.5 billion. The net income was $200 million less than what it made during the same quarter last year.
Ford’s earnings per share excluding special items of 65 cents per share beat analyst expectations by 5 cents.
While the company’s results are not as impressive as last year’s—when Ford literally shocked analysts by reporting a huge gain—part of the reason is because it is investing heavily in new technologies and new markets to expand the company. Ford expects $4 billion in additional expenses this year, and has raised prices on some vehicles to compensate.
The company expects demand to be high as the United States continues to grow its economy. The biggest demand is said to come from small cars, which Ford is an industry leader with its new Focus and Fiesta compact cars.
“We are now in position to exceed our performance last year and that’s a heck of a story,” Ford CEO Alan Mulally said in a statement on Tuesday.
Rival automaker Chrysler Group LLC said this week that it had a loss of $370 million for the quarter, however, part of which was due to $551 million in payments made to the U.S. government to repay the bailout funds it received in 2008.
Top-line revenues for Chrysler increased to $13.7 billion, an increase of more than 30 percent compared with the same quarter a year ago.
Chrysler is now majority-owned by Italian automaker Fiat S.p.A., which bought out the stakes held by the U.S. and Canadian governments last week. Fiat CEO Sergio Marchionne currently leads Chrysler, and Fiat plans to use Chrysler as a platform to return Fiat and its sister brands to the U.S. market this year.
Two of the “Big Three” U.S. automakers—with General Motors being the third—reported solid second quarter earnings this week.
Ford, the Dearborn, Mich.-based automaker, said that second quarter profits were $2.4 billion on sales of $35.5 billion. The net income was $200 million less than what it made during the same quarter last year.
Ford’s earnings per share excluding special items of 65 cents per share beat analyst expectations by 5 cents.
While the company’s results are not as impressive as last year’s—when Ford literally shocked analysts by reporting a huge gain—part of the reason is because it is investing heavily in new technologies and new markets to expand the company. Ford expects $4 billion in additional expenses this year, and has raised prices on some vehicles to compensate.
The company expects demand to be high as the United States continues to grow its economy. The biggest demand is said to come from small cars, which Ford is an industry leader with its new Focus and Fiesta compact cars.
“We are now in position to exceed our performance last year and that’s a heck of a story,” Ford CEO Alan Mulally said in a statement on Tuesday.
Rival automaker Chrysler Group LLC said this week that it had a loss of $370 million for the quarter, however, part of which was due to $551 million in payments made to the U.S. government to repay the bailout funds it received in 2008.
Top-line revenues for Chrysler increased to $13.7 billion, an increase of more than 30 percent compared with the same quarter a year ago.
Chrysler is now majority-owned by Italian automaker Fiat S.p.A., which bought out the stakes held by the U.S. and Canadian governments last week. Fiat CEO Sergio Marchionne currently leads Chrysler, and Fiat plans to use Chrysler as a platform to return Fiat and its sister brands to the U.S. market this year.
