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Ford Falls as Supply Chain Issues Weigh on Q4, Hurdles Remain

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By Dhirendra Tripathi

Investing.com – Ford Motor stock (NYSE:F) fell 5% in Friday’s premarket trading after supply shortages of key inputs pushed the company’s fourth-quarter earnings and revenue well below estimates.

The carmaker booked adjusted earnings of 26 cents a share on revenue of nearly $38 billion. Analysts expected those numbers to be 44 cents and $41 billion, respectively. Wholesale sales were down 11%, a fall the company aims to reverse with a 10%-15% increase in 2022. However, the recovery will be back-loaded: Ford warned unit sales will fall in the current quarter.

“We have incredible demand for our products,” Bloomberg quoted Chief Financial Officer John Lawler as saying. “It’s the supply chains that limited what we could produce and what we could provide. And we see that easing into ’22, and you’ll see that flowing through our profits.”

The company is projecting commodity costs to be higher by $1.5 billion-$2 billion this year.

Investors have cheered Chief Executive Officer Jim Farley’s effort to accelerate Ford’s switch to electric vehicles, evident in the demand for its electric truck F-150 Lightning. The stock was the fifth best performing on S&P 500 last year.

According to Reuters, Ford has 275,000 orders for its electric F-150 Lightning, transit vans and Mustang Mach-E utility vehicles, and expects to double electric vehicle production capacity to 600,000 vehicles a year by 2023.

Ford has earmarked $7 billion-$8 billion for capital spending in 2022, up from $6.2 billion in 2021.

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