After Strong Quarter, Ford Aims to 'Disrupt Like a Startup'
DETROIT -- Ford's chief executive, Mark Fields, said Tuesday he wants the company to act "like a startup" as it prepares for an evolution of the auto industry, after it posted second-quarter profit that handily beat expectations.
Ford and other major automakers are racing to position themselves to profit during what Fields termed a rare "period of change and disruption in the industry" that includes car-sharing, autonomous vehicles, connected cars and new ways for people to get around.
Fields pointed to 25 experiments Ford announced earlier this year to determine mobility needs of the globe's consumers in coming decades.
%VIRTUAL-pullquote-We are really pushing ourselves to think, to act, and disrupt like a startup company.%"We are really pushing ourselves to think, to act, and disrupt like a startup company," said Fields, who heads the automaker founded by Henry Ford 112 years ago.
It is too early to determine the success of Ford's efforts to adapt to a changing industry, Barclays analyst Brian Johnson said in an interview, adding, "It's very encouraging that [Fields] and [Executive Chairman] Bill Ford are thinking about this type of thing."
Ford's traditional business in the second quarter generated the company's highest automotive profit since 2000, based on the strength of its core pickup truck and SUV business in the North American market.
Fields and Ford Chief Financial Officer Bob Shanks said the second half of 2015 will generate more than the $4.3 billion in first-half operating profit, as new launches increase sales and command better prices. The company maintained its 2015 operating profit forecast of between $8.5 billion and $9.5 billion.
Beating the Street
Ford posted net quarterly profit of $1.89 billion, or 47 cents a share. Analysts estimated profit of 37 cents a share, according to Thomson Reuters I/B/E/S.
Ford (F) shares were up 1.9 percent Tuesday afternoon to $14.83.
Operating profit totaled nearly $2.6 billion in North America, a company record for any quarter.
Ford also maintained a forecast of North American profit margin between 8.5 percent and 9.5 percent. First-half North American margin was 9.1 percent.
Operating profit in Asia Pacific rose 21 percent to $192 million despite a dip in industry sales in China, the world's biggest auto market.
"As this has been happening, we have been adjusting our production all along" due to the lower demand, said Shanks.
Ford lowered its 2015 forecast for industry sales in China to 23 million to 24 million vehicles, from 24.5 million to 26.5 million at the start of the year.