Ford Pro and Ford Blue reported solid second-quarter results, showing a 12% year-over-year increase in revenue to $45 billion. The appeal of Ford Pro to commercial customers led to a remarkable 22% revenue growth, with Earnings Before Interest and Taxes (EBIT) more than doubling to $2.4 billion, representing a 15% margin. Ford Blue's gas and hybrid business also performed well, reporting higher wholesales and revenue, achieving $2.3 billion in EBIT.
Ford Model e revenue increased by 39%, indicating their success in establishing leadership in the EV market. With scaling and competitive pricing, Ford is now anticipating reaching a 600,000-run rate in EV production in 2024. CEO Jim Farley highlighted Ford's resilience, efficiency and profitability, attributing their success to the Ford+ initiative.
Ford's balance sheet remains strong, boasting nearly $30 billion in cash and over $47 billion in liquidity at the end of Q2. CFO John Lawler emphasized their ability to simultaneously fund disciplined investment in growth and return capital to shareholders.
Ford Pro's performance was driven by a winning combination of vehicles, software, and services, resulting in a 22% jump in revenue and a 15% margin. Their solutions for fleet management, telematics and EV charging have gained traction, with over 80% of Ford's paid software and services subscribers under Ford Pro.
Ford Blue's focus on improving quality and reducing costs contributed to growth in wholesales, revenue and EBIT. The recently launched 2024 Ford Ranger, highly connected and sold in over 180 markets, further enhanced Ford Blue's performance.
With a robust plan for transforming their existing complex in Ontario, Can., for high-volume EV manufacturing, Ford is positioning itself as an early mover in the EV market. They are making strategic investments in capabilities and capacity worldwide, which Farley believes will set them apart from competitors.
Ford's outlook is optimistic, with guidance for full-year 2023 consolidated adjusted EBIT expected to be between $11 billion and $12 billion. The company anticipates a full-year adjusted free cash flow between $6.5 billion and $7 billion, with capital expenditures ranging from $8 billion to $9 billion.
The Ford+ plan aims to create a high-performing business and long-term value for stakeholders. With a focus on trucks, SUVs and commercial vans, along with improved quality and lower costs, Ford aspires to achieve profitable growth and valuation as a technology-led industrial leader.
