Ford lost $2 billion in the first quarter, and it warned investors Tuesday that its finances will be far worse in the current quarter.
The company it expects a loss before interest, taxes and special items to reach $5 billion in the quarter, compared to a $632 million loss on that basis in the just-completed quarter. Ford (F) posted a narrow profit in South America but lost money in every other region, posting a $1.9 billion adjusted operating loss in North America.
Revenue in the first quarter fell 15% to $34.3 billion, as the number of cars sold fell 21%. It also said it burned through $2.2 billion in the quarter, but because of additional borrowing it had $34 billion in cash on hand as of last Friday. Its borrowing came from drawing down $15 billion from existing lines of credit and issuing $8 billion in bonds.
This is a difficult time for all automakers. Besides having to suspend production at their factories around the world, many dealerships have been shut because of governmental stay-at-home orders. And with millions out of work and millions more working from home, the consumers’ need and ability to buy new cars is significantly reduced.