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Ford's profit hits $1 billion; 2011 outlook shifts gears

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By TOM KRISHER and DEE-ANN DURBIN

The Associated Press

Published: November 3, 2009

DEARBORN, Mich. - Ford, the only Detroit automaker to dodge direct government aid and bankruptcy court, surprised investors with net income of nearly $1 billion in the third quarter and forecast a "solidly profitable" 2011.

The automaker said Monday earnings were fueled by U.S. market share gains, cost cuts and the Cash for Clunkers program, which drew flocks of buyers to showrooms this summer. Ford's shares rose 53 cents, or 7.6 percent, to $7.53 in afternoon trading.

The latest results signal that Ford's turnaround is on more solid ground. The company lost more than $14.6 billion last year and hasn't posted a full-year profit since 2005. Although it made a profit in the second quarter, that was mainly because of debt reductions that cut its interest payments.

Ford, based in Dearborn, reported third-quarter net income of $997 million, or 29 cents per share. Its profit forecast for 2011 was a step above previous guidance of break-even or better for the year.

Excluding one-time items, Ford earned 26 cents per share, blowing away analysts' expectations of a loss of 12 cents.

But Ford still faces obstacles in its turnaround. On Monday, the United Auto Workers union said its members overwhelmingly rejected a deal that would have brought Ford's labor costs in line with rivals General Motors Corp. and Chrysler LLC.

Seventy percent of production workers and 75 percent of skilled tradesmen such as electricians and pipefitters voted against it. The union said it would not return to the bargaining table.

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