Ford's Q3 losses mount to $5.8bn

DEARBORN: Struggling US auto giant Ford Motor posted a mammoth third-quarter net loss of $5.8bn as restructuring costs hammered its earnings.

Ford also revealed it would restate results from ’01 through to this year’s third quarter, “to correct the accounting for certain derivative transactions” by its consumer credit division.

Ford’s newly-appointed chief executive, former Boeing executive Alan Mulally, said the results were ‘clearly unacceptable’ and vowed to make more of the smaller, fuel-efficient vehicles pioneered by Japanese automakers. Mulally, in an interview, ruled out an alliance with Renault-Nissan in the near term.

The Ford CEO was quoted as saying that such a partnership would send Ford in the ‘wrong direction’ as it would distract the company from its restructuring plan. Mulally said he has had no contact with Renault-Nissan CEO Carlos Ghosn but Ford could consider alliance talks in the future — ‘but right now I like our focus.’

His comments came in the wake of Renault-Nissan’s collapsed alliance talks with General Motors earlier this month. After that collapse, the French and Japanese partners said they were open to an alliance with another North American partner.

Ford’s loss for the third quarter ended September 30 included heavy provisions for its hard-hitting restructuring plan, which foresees 16 plant closures in North America and the elimination of 45,000 jobs by ’08.

Excluding those provisions, its loss came to $1.2 bn, compared to $191m before exceptional items a year earlier. That translated into a loss of 62 cents per share, a penny more than Wall Street’s average forecast of 61 cents.