Ford finally turns a profit

FORD Australia has returned to profit for the first time since 2010, with the Blue Oval recording an after-tax profit of $27 million in 2017.

 

This result is a significant improvement over Ford’s 2016 result, which saw the company report a loss of $23.7 million, while its 2013 decision to close its manufacturing operations meant a loss of $267m that year.

 

Ford sold 78,161 vehicles in Australia in 2017, which was 3.8 per cent off its 2016 haul. It was enough for a 6.6 per cent market share and sixth place on the best-selling automotive brands list for the year.

 

In contrast, rival Holden was fourth on the sales ladder last year with 90,306 sales, and the brand recorded a $156.8 million profit for 2017.

 

Of Ford’s 2017 sales tally, just 2046 were built at its Victorian facility after the car-maker closed its manufacturing operations in October 2016.

 

Ford also invested heavily in research and development in 2017, spending $471.5 million for the year. 

 

Ford’s Australian engineering and design teams that are housed at the Broadmeadows, Geelong and You Yangs sites are responsible for the development of the Ranger pick-up and related Everest SUV.

 

The Ranger and Everest are sold in about 180 global markets, and the local team are working on the US and Chinese-market versions of the Ranger, as well as various other global model programs.

 

Ford further invested $14 million – of a planned $50m over three years – on new and upgraded facilities, including an expansion of the design studio, equipment and facilities at the You Yangs proving ground.

 

Revenue from continuing operations hit $3.5 billion in 2017, of which $506.5 million was gained through Ford Australia’s engineering arm. The remaining $3b came from sales of Ford’s vehicles, parts and services.

 

Ford received $1.6 million last year as part of the federal government’s Automotive Transformation Scheme. 

 

In 2017, the company spent $4.9 million on staff redundancies.

 

In a statement, Ford Australia said it was “on track” in transforming and growing its business. The company also highlighted the impact of decommissioning the manufacturing plant, although it is unclear in the report how much this set Ford back in 2017.

 

“Our 2017 financials reflect a significant growth in our core business as we move towards sustainable profitability. This is tempered by ongoing decommissioning costs. Ford continues to focus on refreshing our product line-up to offer more innovative products for consumers and to drive profitable growth.

 

“Ford continues to invest in the future with nearly $3 billion in R&D in Australia the past seven years, and more than $475 million confirmed for 2018 to bring more vehicles to market for consumers all over the world. 

 

“We are now Australia’s largest auto employer with over 2000 highly skilled professionals, including the team that leads the design and engineering of the Ranger, Ranger Raptor and Everest for Australia and the world.”

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