Ford not sure, when it would return to profitability

Ford not sure, when it would return to profitability

The second largest automaker in the American market Ford is finding itself in lots of trouble these days. The Japanese companies are hurting them in their domestic market with their ultra reliable cars, which have become a favorite amongst American consumers. The company had to resort to selling cars at employee prices to get decent sales in the last couple of months. And with plans to shut down some of their loss making plants, things are not looking good for the company.

Ford’s chief operating officer Jim Padilla was talking to media personals when he declined to predict when the company would return back to profitability in their North America operations. He just claimed that the entire industry would see hard times in the next coming years. Jim said: “I think the nature of competition in the marketplace is very, very challenging for all of us.”

The company had to slash its profit forecast twice this year and their North American auto operations reported a pretax loss of $1.21 billion, including charges, in the second quarter. They have also declined to provide a quarterly financial forecast. The company has plans to announce a restructuring plan this fall and it would not be surprising if more job cuts are announced during that announcement.

Jim also said that the company has no further plans to extend their big employee pricing discounts, which has helped them gain impressive sales in the last couple of months. Looks like the company is struggling to sell cars at such high discounts which leads to lowering profitability on each car they sell.