Ford Motor lost $2 billion during the first quarter and warned investors that losses during the second quarter will widen as the company grapples with the fallout from the coronavirus pandemic that's shuttered factories and devastated sales.
Before taxes, and after adjusting for one-time items, Ford lost $632 million, and that number is expected to top $5 billion during the second quarter, the automaker said Tuesday.
Ford shares were down about 6% during extended-hours trading Tuesday to $5.10, erasing the automaker's gains for the day. Shares of the automaker are down about 42% this year.
The automaker's total revenue, which includes auto sales and financing, slid 14.9% to $34.3 billion. The coronavirus had a "negative effect" of at least $2 billion on the company's earnings during the first three months of the year, Ford said.
The outbreak significantly hobbled Ford's performance, "as protecting people and helping society respond to the crisis became primary measures of current success alongside balance-sheet management and operational excellence," the company said.
Ford burned through $2.2 billion in cash during the quarter, a number Wall Street is closely watching.
Ford Chief Financial Officer Tim Stone said the automaker expects the second quarter to be the most impacted by the coronavirus pandemic as it plans to execute a phased reopening of domestic plants beginning as early as next month.
Stone declined to disclose specific cash flow guidance for the year. He said the company had $35 billion in cash as of last Friday, after paying its suppliers. He said that amount is enough to get the company through the end of the year without any production, if it were to come to that.
The company tapped $15.4 billion last month against two existing credit lines. Ford earlier this month also sold about $8 billion in bonds, it said April 17.
"Our objective is not to just withstand the crisis," Stone told reporters during a call Tuesday. "We're ensuring the flexibility to continue to invest in our future."
Stone said an $11 billion restructuring plan for the automaker into the early 2020s remains "on track."
Ford suspended its quarterly dividend and pulled its 2020 guidance last month as it shuttered its U.S. plants due to Covid-19. The company, citing the volatility of the economic environment, did not announce a new 2020 forecast.
Automakers across the globe have been forced to conduct rolling plant shutdowns due to Covid-19. What started as a problem in China to begin the year, quickly grew to a supply base issue and then a global pandemic that shut down U.S. facilities, which remain closed.
Urged by the United Auto Workers union, Ford, General Motors and Fiat Chrysler announced plans to temporarily close their plants due to the coronavirus on March 18. Pending discussions with the union, the facilities could begin to reopen as soon as next month.
Ford on Tuesday said it plans to begin reopening its European plants next week with new global safety protocols to limit the spread of Covid-19, providing a potential template for reopening its U.S. operations.
Ford's first-quarter vehicle sales fell 12.5% from a year ago, the company said earlier this month.
IHS Markit expects worldwide vehicle sales to decline 22% this year to 70.3 million units, led by a 26.6% fall in the U.S. to 12.5 million units, compared with a year ago.