Ford Motor Company, one of the big three automotive companies of the US registered a revenue of $156 billion in 2019, which is around 3% lower than in 2018. However, the net income has declined by 98% for the same period from $3.67 billion in 2018 to just $47 million in 2019. The company registered a downfall in its vehicle sales in all the major economies except Germany. The US is still the largest market for Ford, with sales of around 2.4 million vehicles in 2019, but a downfall of 120,000 vehicle sales was registered in the country. The most affected region is South America and China. In South America, sales down by 19% whereas in China, vehicle sales sleep by 26%. Germany was only the country that registered a slight increment in sales from 313,000 in 2018 to 328,000 in 2019.
The fourth quarter for the company was not good and had to face a loss of around $1.7 billion. Overall in 2019, the company had recorded a charge of $6.0 billion of special item charges which include $2.5 billion for pension and other post-employment benefits re-measurement loss. However, in its 2020 Company Guidance, Ford had estimated free cash flow in the range of $2.4 and $3.4 billion and EBIT of $5.6 billion to $6.6 billion in 2020. All these estimates had not included the impact of COVID-19 on the company and automotive industry.
After the COVID-19 pandemic, the company has to shut down its various manufacturing plant globally. Alone in the US the company closed eight assembly plants on 18th March due to the COVID-19 pandemic and no US Ford plant will restart before 14th April. In March 2020, the company also suspended its dividend and withdraws 2020 guidance because of coronavirus. The company has also announced to draw two credit lines of $15.4 billion.
Awake to the situation, the company is also taking the initiative to fight back COVID-19. It has collaborated with GE Healthcare to produce 50,000 ventilators in the next 100 days and 30,000 a month thereafter as needed. The company is also engaged in assembling 100,000 plastic face shields per week. The company has also donated $1 million for groups battling the pandemic across the globe.
