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Ford cuts 2024 earnings guidance due to warranty costs and slow pace of cost cutting
Headline News |
2024/10/27 22:47
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Stubbornly high warranty expenses and lagging cost-cutting efforts are holding back Ford Motor Co.'s profits this year, causing the company to lower its full-year earnings guidance.
That pushed the company’s stock price down 6% in trading after Monday’s closing bell.
The Dearborn, Michigan, automaker, which reported third-quarter earnings Monday, said its net profit tumbled nearly 26% as it took $1 billion in accounting charges to write down assets for a canceled three-row electric SUV.
Ford said it made $892 million from July through September, compared with $1.2 billion it made a year earlier.
But excluding the one-time items, the company made an adjusted pretax profit of $2.6 billion, or 49 cents per share. That beat analyst estimates of 46 cents, according to FactSet.
Revenue rose 5.5% to $46.2 billion, also beating Wall Street predictions. Ford reduced its full-year pretax income guidance to $10 billion, at the low end of the $10 billion to $12 billion it expected at the end of the second quarter, spooking investors.
“Cost, especially warranty, has held back our earnings power, but as we bend that curve, there is significant financial upside for investors,” CEO Jim Farley told analysts on a conference call.
Chief Financial Officer John Lawler said warranty costs were slightly below the third quarter of last year, but still high. The company wouldn’t give numbers until it files its quarterly report with securities regulators on Tuesday but said costs will be higher than a year ago.
Ford reported $800 million of increased warranty costs for the second quarter of this year.
Farley has been trying to get a handle on warranty costs for the past four years. In October of 2020, he said the company was working to cut quality-related repairs after glitch-prone small-car transmissions hit the automaker’s bottom line.
Ford has said that it has a $7 billion cost gap with competitors, and Lawler said Monday it has made progress on that figure. The problem is competitors, which he did not identify, are cutting costs too. “We’ve taken cost out, but we’re not doing it at a pace faster than our competition,” he told analysts.
Ford has removed $2 billion in material, freight and labor costs this year, but that was offset by warranties and inflation at its Turkish joint venture, he said.
He said Ford is focused on reducing warranty and other costs, which will show up in later quarters.
The company’s plans are working, as evidenced by 10 straight quarters of revenue growth, Lawler said.
Farley said Ford has restructured its operations in Europe, South America, India and China, which collectively lost $2.2 billion in 2018 but together are profitable now. For instance, China, including exports, has contributed over $600 million to pretax earnings this year, Farley said. |
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Fueled by border crossings, a record 3 million cases clog US immigration courts
Headline News |
2024/01/16 17:34
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Eight months after crossing the Rio Grande into the United States, a couple in their 20s sat in an immigration court in Miami with their three young children. Through an interpreter, they asked a judge to give them more time to find an attorney to file for asylum and not be deported back to Honduras, where gangs threatened them.
Judge Christina Martyak agreed to a three-month extension, referred Aarón Rodriguéz and Cindy Baneza to free legal aid provided by the Catholic Archdiocese of Miami in the same courthouse — and their case remains one of the unprecedented 3 million currently pending in immigration courts around the United States.
Fueled by record-breaking increases in migrants who seek asylum after being apprehended for crossing the border illegally, the court backlog has grown by more than 1 million over the last fiscal year and it’s now triple what it was in 2019, according to government data compiled by Syracuse University’s Transactional Records Access Clearinghouse.
Judges, attorneys and migrant advocates worry that’s rendering an already strained system unworkable, as it often takes several years to grant asylum-seekers a new stable life and to deport those with no right to remain in the country.
“Sometimes hope already sinks,” said Mayra Cruz after her case was also granted an extension by Martyak because the Peruvian migrant doesn’t have an attorney.
“But here I’ve felt a bit safer,” added Cruz, who said she had to flee with only the clothes on her back with her partner and their children after repeated threats from gangs.
About 261,000 cases of migrants placed in removal proceedings are pending in the Miami court — the largest docket in the country. That’s about the same as were pending nationwide a dozen years ago, said Syracuse University professor Austin Kocher.
The backlog includes migrants who have been in the United States for decades and were apprehended on unrelated charges, but most are new asylum seekers who declare a fear of persecution if they are sent back, he added.
Backlogged courts, administered by the Justice Department, often get little attention in immigration debates, including in current Senate negotiations over the Biden administration’s $110 billion proposal that links aid for Ukraine and Israel to asylum and other border policy changes.
When migrants are apprehended by U.S. authorities at the border, many are released with a record of their detention and instructions to appear in court in the city where they are headed. That information is passed on from the Department of Homeland Security to the Justice Department, whose Executive Office for Immigration Review runs the courts, so that an initial hearing can be scheduled.
“They’re just being released without any idea of what comes next,” said Randy McGrorty, executive director of Catholic Legal Services for the Archdiocese of Miami, which has seen hundreds of thousands of migrants join its diaspora communities.
So many migrants go to them for advice that, in the last couple of years, they’ve largely switched to teaching how to self-petition and represent themselves before judges.
“We help them understand what judges want, and we help judges with efficiency and preserving fundamental rights,” said Miguel Mora, a Catholic Legal Services supervising attorney in Miami.
Advocates say that most migrants ask for individual legal representation, something that’s becoming increasingly rare given the huge numbers, and how to get work permits, which migrants can apply for 150 days after filing their asylum application. |
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Court upholds judge’s finding that Tesla acquisition of Solar City was fair
Headline News |
2023/10/14 07:28
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The Supreme Court on Monday ordered two internet sellers of gun parts to comply with a Biden administration regulation aimed at ghost guns, firearms that are difficult to trace because they lack serial numbers.
The court had intervened once before, by a 5-4 vote in August, to keep the regulation in effect after it had been invalidated by a lower court. No justice dissented publicly from Monday’s order, which followed a ruling from a federal judge in Texas that exempted the two companies, Blackhawk Manufacturing Group and Defense Distributed, from having to abide by the regulation of ghost gun kits.
Other makers of gun parts also had been seeking similar court orders, the administration told the Supreme Court in a filing.
“Absent relief from this Court, therefore, untraceable ghost guns will remain widely available to anyone with a computer and a credit card — no background check required,” Solicitor General Elizabeth Prelogar, the administration’s top Supreme Court lawyer, wrote.
The regulation changed the definition of a firearm under federal law to include unfinished parts, like the frame of a handgun or the receiver of a long gun, so they can be tracked more easily. Those parts must be licensed and include serial numbers. Manufacturers must also run background checks before a sale - as they do with other commercially made firearms.
The requirement applies regardless of how the firearm was made, meaning it includes ghost guns made from individual parts or kits or by 3D printers.
The regulation will be in effect while the administration appeals the judge’s ruling to the 5th U.S. Circuit Court of Appeals in New Orleans — and potentially the Supreme Court. |
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Federal court sides with lobster fishers in whale protection case
Headline News |
2023/06/16 02:39
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A federal appeals court has sided with commercial fishermen who say proposed restrictions aimed at saving a vanishing species of whale could put them out of business.
The fishermen harvest lobsters and crabs off New England and oppose tough new restrictions on the way they fish that are intended to protect the North Atlantic right whale. The whale numbers only about 340 in the world and it’s vulnerable to lethal entanglement in fishing gear.
The fishermen and the state of Maine appealed their case to the U.S. Court of Appeals for the District of Columbia Circuit after losing in a lower court. The appeals court said Friday it disagreed with the lower court’s ruling.
The appeals court ruling could mean that the federal government must take another stab at crafting new rules to protect the whales. The restrictions would limit where lobster fishers can fish and what kind of gear they can use to try to prevent the whales from becoming entangled in fishing ropes.
The changes would represent a potential worst-case scenario for the lobster fishing industry, wrote Douglas H. Ginsburg, the senior judge of the appeals court, in Friday’s ruling.
“The result may be great physical and human capital destroyed, and thousands of jobs lost, with all the degradation that attends such dislocations,” Ginsburg wrote.
The fishers sued the National Marine Fisheries Service, an arm of the federal government. The service declined to comment on the lawsuit. |
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Biden and McCarthy reach a final deal and now must sell it to Congress
Headline News |
2023/05/29 17:16
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With days to spare before a potential first-ever government default, President Joe Biden and House Speaker Kevin McCarthy reached final agreement Sunday on a deal to raise the nation’s debt ceiling and worked to ensure enough support in Congress to pass the measure in the coming week.
The Democratic president and Republican speaker spoke late in the day as negotiators rushed to draft and post the bill text for review, with compromises that neither the hard-right or left flank is likely to support. Instead, the leaders are working to gather backing from the political middle as Congress hurries toward votes before a June 5 deadline to avert a damaging federal default.
“Good news,” Biden declared Sunday evening at the White House.
“The agreement prevents the worst possible crisis, a default, for the first time in our nation’s history,” he said. “Takes the threat of a catastrophic default off the table.”
The president urged both parties in Congress to come together for swift passage. “The speaker and I made clear from the start that the only way forward was a bipartisan agreement,” he said.
The final product includes spending cuts but risks angering some lawmakers as they take a closer look at the concessions. Biden told reporters at the White House upon his return from Delaware that he was confident the plan will make it to his desk.
McCarthy, too, was confident in remarks at the Capitol: “At the end of the day, people can look together to be able to pass this.”
The days ahead will determine whether Washington is again able to narrowly avoid a default on U.S. debt, as it has done many times before, or whether the global economy enters a potential crisis.
In the United States, a default could cause financial markets to freeze up and spark an international financial crisis. Analysts say millions of jobs would vanish, borrowing and unemployment rates would jump, and a stock-market plunge could erase trillions of dollars in household wealth. It would all but shatter the $24 trillion market for Treasury debt.
Anxious retirees and others were already making contingency plans for missed checks, with the next Social Security payments due soon as the world watches American leadership at stake.
McCarthy and his negotiators portrayed the deal as delivering for Republicans though it fell well short of the sweeping spending cuts they sought. Top White House officials were briefing Democratic lawmakers and phoning some directly to try to shore up support.
One surprise was a provision important to influential Sen. Joe Manchin, D-W.Va., giving congressional backing for the controversial Mountain Valley Pipeline, a natural gas project, that is certain to raise questions. |
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Bando Apartments in Los Angeles, California
Headline News |
2023/05/08 17:25
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The BORA 3170 has a variety of floorplans ranging from luxury studios to two bedrooms. Each apartment offers a tranquil setting ready to be furnished in your individual style. Your home at The BORA 3170 is your sanctuary and the beautifully designed common areas are your retreat.
A Koreatown property once slated for redeveloped with senior housing will instead be folded into a new mixed-use apartment complex, per an application submitted earlier this month to the Los Angeles Department of City Planning.
Led by Chairman Kwon Hong-sa, the Korean developer began considering the project two years ago and bought the land in LA in July 2019, the company said. Construction is expected to be complete in May 2022.
“The Bora 3170 will become a landmark in Korea Town in LA, and a new success model for overseas construction projects, after the Ubora Towers in Dubai,” a Bando E&C representative said.
The building will serve both commercial and residential purposes, and will be able to accommodate 252 households in 115 studio apartments, 131 one-room apartments and six two-room apartments, the company said.
TOP LUXURY FEATURES ONLY at The BORA 3170
- Fitness Center
- Pool & Spa
- Roof Top BBQ Grill
- Indoor Screen Golf
- Lounges/Club Room with TV Lounge
- Gated Safe Parking
- Package Tracking System
- Outdoor Living Deck
- TESLA EV Charger & Universal EV Charger |
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