DEARBORN, Mich., Jan. 17 (UPI) -- Ford Motor Co., the world's second largest automaker, said Thursday it posted a fourth quarter net loss of $5.07 billion compared with a profit of $1.08 billion during the same period a year earlier.
Excluding restructuring charges of $4.1 billion and an additional $102 million non-cash charge for the accounting standard on hedging and derivatives, the automaker said it lost $860 million, or 48 cents a share, in the latest fourth quarter. Analysts on Wall Street had expected Ford to post a loss of 50 cents a share, according to Thomson Financial/First Call.
Total revenues in the fourth quarter declined 3 percent to $41.15 billion from $42.59 billion a year ago. Worldwide vehicle unit sales in the quarter declined 2 percent to 1,808,000 units from 1,840,000 a year earlier.
Revenues for all of 2001 declined 5 percent to $162.4 billion from $170.1 billion a year ago. Vehicle unit sales declined 6 percent to 6,991,000 units from 7,424,000 in 2000.
"This was a challenging, difficult year for the Ford Motor Company and our financial performance was unacceptable," said Chairman and Chief Executive Officer Bill Ford.
"As outlined in our revitalization plan, we are committed to regaining our momentum and getting back on track. The difficult actions we announced last week will focus us on designing, building and selling the industry's best cars and trucks -- and restoring the company's profitability," he said.
Last week, Ford, which has seen a sharp decline in its business in the past year, revealed the details of a sweeping restructuring plan that includes closing five plants, eliminating 35,000 jobs worldwide and a $4.1 billion charge in the fourth quarter.
Ford also said it will sell about $1 billion of non-core assets, cut annual capacity to 4.8 million vehicles from 5.7 million and cut its dividend for the second time in less than six months.
Ford has sought to cut costs after several product recalls and higher marketing expenses began to erode profits in the last few quarters.
As part of the turnaround, Ford is killing under-performing models this year, including the Mercury Cougar and Villager, the Lincoln Continental and the Ford Escort.
Ford expects the plan to deliver $9 billion of pretax profit improvement by the middle of the decade.
The company said in the fourth quarter, worldwide automotive operations lost $803 million on revenues of $33.77 billion. That compares to a profit of $762 million on revenues of $35.11 billion in the fourth quarter of 2000.
The company said in the fourth quarter its loss in North America was $916 million, compared to a profit of $740 million a year ago. Revenue declined to $23.26 billion from $25.59 billion.
Ford said the decline was primarily a result of the intense competitive environment in the United States, which led to lower unit sales volume and higher marketing costs. Marketing costs in the United States as a percent of revenue in the fourth quarter were 16.7 percent of revenues, up 6 points from a year ago.
Ford's European Automotive operations posted a fourth quarter profit of $61 million on revenue of $8.46 billion, which rose from a year ago profit of $33 million on revenue of $7.33 billion.
The company said strong new Ford brand products, including the Mondeo and Transit, and cost reductions led to the improved 2001 results in the division.
The company's automotive operations in South America widened losses in the fourth quarter to $46 million, on revenue of $466 million from a loss of $31 million on revenue of $642 million. Continuing weak economic conditions in Brazil and Argentina contributed to the lower results, Ford said.
The Ford Credit division lost $297 million in the fourth quarter, including unusual charges. Excluding charges, the division earned $6 million before charges, compared to $410 million a year ago.
Ford Credit, the world's largest automotive finance company, said the unusual charges included strategic actions in Brazil, government initiatives in Argentina related to currency devaluation and consumer debt, and voluntary employee separation costs in North America.
Ford's Hertz division lost $58 million in the fourth quarter, compared to earning $56 million a year ago.
The decline was attributable to a slowing U.S. economy, which affected U.S. travel and car rentals, as well as a more competitive pricing environment for all Hertz business units, the company said.
Looking ahead Ford said although the U.S. economy continues to be uncertain, the company estimates total demand will be about 15.5 million vehicles.
