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Ford Q1 profits dragged down by warranty costs

General Motors isn't the only Detroit automaker posting falling profits in the first quarter. Ford just released its Q1 2014 financial data, and it reported a net income of $989 million, down $622 million from Q1 2013. The drop is partially blamed on higher warranty and recall expenses than the company had anticipated.
Financially, Ford suffered a rough quarter almost across the board. Its pre-tax profit of $1.4 billion was also down $765 million from a year ago. Things were even worse in the North American market where operating profit fell significantly to $1.5 billion, down from $2.392 billion in Q1 2013. However, its global revenue ticked up slightly to $35.9 billion, from $35.6 billion in this period in 2013.
Ford admitted that it spent about $900 million on expenses that it hadn't planned for during this quarter. According to Reuters, the company paid about $400 million in additional warranty and recall costs in North America. The automaker didn't explain why the costs were so much higher than expected. However, in the last three months, Ford has had several recalls, including on the 2001-2004 Escape for rust, Explorer for its steering, Edge for its fuel line and others.

Who would win in a race if the Super Bowl teams were cars?

Until the last down is played this Sunday, we will have the annoyance pleasure of listening to analysts bicker between who will win the Super Bowl, not unlike automotive analysts who do the same thing with cars. If I had a dollar for every conversation about what car would win against another on a specific track, I wouldn't be buying the raw avocados this year for my guacamole. Instead I would be purchasing organic avocados and have the guacamole served in a Ferrari-themed bowl. Yes, those exist. Even so, we still watch year after year knowing full well that the pre-game analysis typically adds up to less than what is left over in the chip bowl after the last guest leaves. Let's take a different approach to analysis this year, let's compare these teams to their vehicle equivalent to decide who would win in a fair race. How do you determine a fair race? When I think of a fair race I think of the Nurburgring. A track that is 12.9 miles, has 1,000 feet of elevation change, and is famously nicknamed The Green Hell by famed driver Jackie Stewart. Although your Supra may beat The Flash himself in a straight line, chances are once you push it to the limits on a 12.9-mile track your brakes will smell like a bonfire and your suspension will have gone into cardiac arrest twice. So if we're racing The 'Ring, what are we driving? To best answer that question we must determine what characteristics define these teams. Not being someone who knows more about my fantasy league than my significant other, I can only go off what I have heard from "experts." The Panthers are honestly known for Cam Newton. Cam is a versatile, fast, brash, and fairly young quarterback. He apologizes for nothing and has Ali-like confidence that shows in his choice of Liberace-type attire. Although he looks to be the favorite, he hasn't yet won a Super Bowl and the team's second-half performances are less than climatic. In racing terms, he has won a lot but no one has seen him race in the dark at the 24 Hours of Le Mans. The Panthers have a ton of acceleration, a brand new chassis, and a driver who is hungry for that first big win. On the other side of the track are the Broncos. It seems as though the Broncos are known for two things, a nostalgic quarterback and a defense that could strike fear into a Honey Badger. If the Broncos were just one component of a vehicle they would be the brakes, and these brakes are outfitted for a locomotive.

U.S. automakers unite in opposition to possible Trump vehicle tariffs

WASHINGTON — The U.S. auto industry urged President Donald Trump's administration on Monday not to saddle imported cars and auto parts with steep tariffs, after the U.S. Commerce Department sent a confidential report to the White House late on Sunday with its recommendations for how to proceed. Some trade organizations also blasted the Commerce Department for keeping the details of its "Section 232" national security report shrouded in secrecy, which will make it much harder for the industry to react during the next 90 days Trump will have to review it. "Secrecy around the report only increases the uncertainty and concern across the industry created by the threat of tariffs," the Motor and Equipment Manufacturers Association said in a statement, adding that it was "alarmed and dismayed." "It is critical that our industry have the opportunity to review the recommendations and advise the White House on how proposed tariffs, if they are recommended, will put jobs at risk, impact consumers, and trigger a reduction in U.S. investments that could set us back decades." Representatives from the White House and the Commerce Department could not immediately be reached. The industry has warned that possible tariffs of up to 25 percent on millions of imported cars and parts would add thousands of dollars to vehicle costs and potentially devastate the U.S economy by slashing jobs. Administration officials have said tariff threats on autos are a way to win concessions from Japan and the EU. Last year, Trump agreed not to impose tariffs as long as talks with the two trading partners were proceeding in a productive manner. "We believe the imposition of higher import tariffs on automotive products under Section 232 and the likely retaliatory tariffs against U.S. auto exports would undermine - and not help - the economic and employment contributions that FCA, US, Ford Motor Company and General Motors make to the U.S. economy," said former Missouri Governor Matt Blunt, the president of the American Automotive Policy Council. Some Republican lawmakers have also said they share the industry's concerns. In a statement issued on Monday, Republican Congresswoman Jackie Walorski said she fears the Commerce Department's report could "set the stage for costly tariffs on cars and auto parts." "President Trump is right to seek a level playing field for American businesses and workers, but the best way to do that is with a scalpel, not an axe," she added.