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Ford Boosts 3-Wet Paint Capacity

Zacks Equity Research

Ford Motor Co. (F) is set to add its industry-leading 3-Wet paint processes in 4 more plants in the U.S, China and Spain. This will lead to 50% increase in capacity of the 3-Wet paint process.

Ford is installing the process in Flat Rock Assembly Plant and Kansas City Assembly Plant in U.S, Valencia Assembly Plant in Spain and Jiangling Motors Co. Ltd., Jiangxi/Nanchan in China. With this expansion, Ford expects to install the technology in 12 plants in 2013 and then extend it to other facilities worldwide over the next 4 years.

Ford implemented the 3-Wet high-solids solvent-borne technology for the first time in 2007. Currently, Ford has 8 plants with this process in North America, Asia Pacific and Europe. The eco-friendly process reduces carbon dioxide (CO2) emissions by 15% to 25% and volatile organic compound (VOC) emissions by 10%.

The 3-Wet paint process is the most advanced and conventional technology, which offers high quality durable paints at optimum cost. In this paint process, three layers of paint are applied sequentially while the prior layer remains wet. These three layers act as the primer, base coat and clear coat.

Ford posted a robust 55% rise in earnings per share to 31 cents in the fourth quarter of 2012 from 20 cents in the same quarter of 2011 (all excluding special items). With this, the company surpassed the Zacks Consensus Estimate of 26 cents. The year-over-year improvement was driven by the impressive North American results and, to some extent, solid improvements in Asia Pacific and Africa operations.

Total revenue grew 5.5% to $36.5 billion on a 7.5% rise in wholesale volumes to 1.5 million units. Total revenue was higher than the Zacks Consensus Estimate of $33.2 billion.

Mich. based Ford is one of the largest automobile producers in the world. Currently, the company retains a Zacks Rank #3 (Hold).

Other stocks that are performing well in the industry where Ford operates include Gentherm Incorporated (THRM), Visteon Corp. (VC) and Denso Corp. (DNZOY). All these companies carry a Zacks Rank #1 (Strong Buy).


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