Ford, the world's second biggest carmaker, yesterday capped a disastrous year by reporting a $5.07bn (£3.52bn) loss for the final quarter and warning that it would be hard to return to profit.
The record fourth-quarter loss, the result of a $4.1bn charge to cover the restructuring plan announced last week, left Ford with a deficit for the year of $5.45bn – its first loss in nine years.
Bill Ford, the company's chairman and chief executive, acknowledged it would be difficult to restore profitability and said of the recovery plan, which involves 35,000 job cuts and the closure of five North American car plants: "We realise some of the things that must be done are painful. I can't begin to describe how sorry I am about that."
Ford was battered last year by the Firestone tyre scandal, falling sales, rising production and marketing costs and the departure of its chief executive, Jac Nasser. Vehicle sales fell 6 per cent to 6.99 million while revenues were 5 per cent lower at $162.4bn.
Excluding one-off charges, Ford went from a profit of $6.7bn in 2000 to a loss of $782m. Most of the damage was done in the fourth quarter and the losses were concentrated in Ford's home market.
Ford's North American operations lost $2.15bn for the year and $916m for the final quarter, when declining sales and a poor reception for some of the company's new models forced it into heavy price discounting and cheap financ- ing deals.
However, the picture in Europe was brighter. Ford earned a profit for the year of $266m, compared with a loss of $35m the previous year.
The turnaround was the product of cost cuts implemented at the back end of 2000, including the decision to end car production at the Dagenham site in the UK, and successful new model launches, including the Mondeo car and Transit van.
Nick Scheele, the UK executive who was appointed president and chief operating officer last year, said that although the American economic outlook remained uncertain, Ford was forecasting total vehicle sales in the US of 15.5 million this year. Production from Ford's North American plants is forecast to fall 3 per cent to 1.05 million in the first quarter of this year.Reuse content