Ford Motor Co. reaffirmed its full-year financial guidance Monday even as it said it expects to have a "higher-than-planned" number of vehicles assembled but awaiting parts at the end of the third quarter due to supply shortages.
The Dearborn automaker said in a news release that it expects to have 40,000 to 45,000 vehicles sitting and awaiting parts when the July-September quarter ends. It expects to deliver those vehicles to dealers in the fourth quarter. The vehicles awaiting parts "disproportionately include high-demand, high-margin models of popular trucks and SUVs," according to Ford.
The update comes ahead of the company's third-quarter earnings report on Oct. 26.
During the company's second-quarter earnings report, executives reported that significant progress had been made on completing and shipping vehicles that had been awaiting parts. The company ended the quarter with inventory of about 18,000 vehicles waiting for parts, down from 53,000 at the start of the April-June period.
Executives had previously said they expected vehicle wholesales to improve 10% to 15% this year over 2021. The company did not provide an update on that forecast Monday.
The global automotive industry has been struggling with supply-chain issues, particularly a shortage of semiconductor chips, for well over a year. The parts shortages have curtailed automotive production and resulted in a new-vehicle inventory crunch.
Still, despite the supply-chain snarls and "higher payments made to suppliers to account for the effects of inflation" to the tune of an additional $1 billion this quarter, Ford on Monday reaffirmed its full-year guidance of adjusted earnings before interest and taxes of between $11.5 billion and $12.5 billion.
It also gave guidance for third-quarter financial results, saying it expects adjusted EBIT to land in the range of $1.4 billion to $1.7 billion. In the second quarter, Ford reported net income of $667 million and adjusted EBIT of $3.7 billion. Through the first half of the year, the company has reported a net loss of $2.4 billion and adjusted EBIT of $6 billion.
Ford's stock closed at $14.93 per share Monday. It was down roughly 5% in after-hours trading about 5:30 p.m.
