Love for bigger, fancier vehicles fuels Ford’s Q2

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Ford’s customers are paying up for upgrades, like leather seats and fancy technology, which helped it achieve a record quarter. Jeanne Yurman reports.

Love for bigger, fancier vehicles fuels Ford’s Q2

Americans’ love for bigger vehicles and upscale trucks and SUVs drove Ford’s profit 44 percent higher in the second quarter.

The bottom line rang in at nearly $1.9 billion on revenue of more than $37 billion – far exceeding Wall Street targets.

Ford’s CFO, Bob Shanks.


“North America earned its best quarterly profit ever and a margin of over 11 percent, so the robustness of our business model, but also the favorable external environment we’re operating in certainly contributed to that performance.”

Sales of Ford’s best selling F-150 pick up were down from a year ago as it retooled production for its new aluminum body.

Yet it still saw higher average selling prices as did Ford’s Edge and Explorer SUVs.

A pick up in construction and a shift away from sedans to SUVs is helping the number two auto maker and rivals carve out record gains in North America.

And offsetting a drag from the strong U.S. dollar and a recent slowdown in China.

Not a lot of buyer incentives being handed out in the quarter and UBS autos analyst, Colin Langan expects it will stay that way for the year.


“When your facilities are being fully utilized there’s not a lot of incentive to cut price to chase share.”

For now, amid low gas prices and low interest rates, customers are willing to pay more for a Ford leading it to predict profit margins at the high end of its target range for 2015.

Tags : Fords, Fuels, vehicles, Fancier, Bigger, love

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