In third-quarter beat, Ford finally shows a profit overseas
After several years of posting losses and struggling to increase its business overseas, Ford has finally turned a profit outside the United States.
The automaker's third-quarter earnings, which beat Wall Street estimates by a wide margin, showed improvement in Asia, Latin America and even Europe. It's the first time since second-quarter 2011 that Ford has made money outside North America.
(Read more: Ford increases full-year guidance after strong Q3)
Chief Operating Officer Mark Fields summed up the automaker's improved performance by saying, "We're excited with what we're seeing around the world."
Ford, which lost almost $500 million in Europe in last year's third quarter, more than halved losses there last quarter, to $228 million.
For several years the company has told investors that the goal is to break even in Europe by mid-decade, but CFO Bob Shanks said it may be ahead of that schedule.
"I think we could turn a profit—not just break even—by 2015," he admitted during a conference call with Wall Street analysts.
Ford's turnaround in Europe is a result of several factors.
For one, the automaker's cost-cutting moves, including trimming the workforce and consolidating operations, are filtering through to the bottom line. In addition, Ford finally has been able to raise prices on the vehicles it sells in Europe.
"It's still a competitive environment," Fields said. "The good news is you're starting to see the positive impact of new products in Europe."
Some economies have stabilized, as well, he said.
"There are signs we're seeing some markets return to growth," Shanks said.
With the closure of its plant in Genk, Belgium, at the end of 2014, Ford's costs in Europe will continue to drop. That could be the final boost the company needs to turn a profit there.
Ford's business in China is booming, with sales up 51 percent this year. Sales are improving in Latin America, where the company has introduced several new models.
Mulally dodges Microsoft questions
As expected, Ford's quarterly earnings call included several questions for CEO Alan Mulally about reports he is being considered for the head job at Microsoft. As he's done for weeks, Mulally refused to discuss whether he is considering a switch, saying, "I'm happy at Ford."
Mulally has maintained he has no plans to leave Ford since his name surfaced as a possible replacement for Microsoft CEO Steve Ballmer.
When one reporter asked him directly if he had been in contact with the tech giant, Mulally would not answer yes or no.
"We don't comment about speculation," he said.
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