Ford earns $888 million in third quarter, down 7 percent
Wednesday, October 18th 2000, 12:00 am
By: News On 6
DEARBORN, Mich. (AP) _ Ford Motor Co.'s third-quarter earnings declined 7 percent to $888 million, a drop the company blamed on costs from the recall of 6.5 million Firestone tires.
``Getting our customers onto good tires has been, and continues to be, more important than short-term profits,'' Ford president and CEO Jacques Nasser said Wednesday in a statement. ``This was a difficult quarter for our customers, our employees, our dealers and our shareholders.''
Bridgestone/Firestone Inc. recalled the tires, many of which were used on Ford Explorers. They have been linked to at least 119 deaths and 500 injuries in the United States.
Ford did not give an estimate for the cost of the recall on Wednesday, but Nasser told CBS' ''60 Minutes'' earlier this month that it would cost about $500 million.
The stock was trading for $24.44 early Wednesday, down 19 cents from Tuesday's close on the New York Stock Exchange.
The world's No. 2 automaker earned 53 cents a share for the three months ending in September, compared with 78 cents a share, or $959 million overall, for the same period in 1999. Last year's results do not include earnings from Visteon Corp., the parts arm Ford spun off this year.
The results met Wall Street expectations after adjusting for a complicated stock swap that changed the number of shares in the company during the quarter. Wall Street analysts had expected earnings of 50 cents a share, according to First Call/Thomson Financial.
Earnings in Ford's automotive operations totaled $391 million, a drop of 27 percent from $535 million over last year.
The costs to Ford for the tire recall include the temporary shutdown of three factories to divert tires to consumers, which cut production of the highly profitable Explorer and Mercury Mountaineer by 15,000 vehicles. The 6,000 plant workers earned 95 percent of their regular pay during the three-week shutdown.