Ford Motor Company has released its third-quarter results, surpassing analysts’ expectations, despite anticipating significant financial impacts due to a recent fire at the Novelis aluminum plant in New York. This incident is expected to affect Ford’s production of its popular F-150 pickups and SUVs.
The automaker estimates that the fire will lead to an adjusted EBIT (earnings before interest and taxes) headwind of between $1.5 billion to $2.0 billion in 2025, contributing to a decline in full-year cash flow. However, Ford is optimistic about mitigating at least $1 billion of that loss by 2026. The full financial repercussions from the aluminum plant fire are expected to reflect in Ford’s fourth-quarter results.
Consequently, Ford has lowered its full-year outlook, projecting adjusted EBIT of $6 billion to $6.5 billion, a decrease from the previous range of $6.5 billion to $7.5 billion. Additionally, the outlook for adjusted free cash flow has been revised downward to $2 billion to $3 billion, compared to earlier estimates of $3.5 billion to $4.5 billion. CFO Sherry House indicated that the production disruptions would significantly impact working capital temporarily but expects a recovery in the following year.
Despite these challenges, Ford has plans to ramp up production of the F-150 and F-Series Super Duty trucks by over 50,000 units in 2026 to meet existing demand and to recover from losses incurred due to the fire. However, production of the F-150 Lightning electric vehicle will remain on hold to ensure a focus on the more traditional gas and hybrid models.
In its quarterly performance, Ford reported automotive revenue of $47.185 billion, exceeding the Bloomberg consensus estimate of $43.70 billion. The company achieved an adjusted EPS (earnings per share) of $0.45, well above the anticipated $0.36, with an adjusted EBIT of $2.6 billion also beating expectations of $2.02 billion.
Moreover, Ford continues to face challenges from former President Trump’s auto tariffs, which have already impacted the company by $700 million in Q3. The tariffs are projected to have a total net impact of $1 billion for the full year. However, Ford’s position may improve due to new offsets introduced by the White House that could alleviate some of the burdens for the automaker.
As the company navigates these hurdles, it remains focused on increasing production capabilities and maintaining stability in the face of external challenges.