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Ford books $2.6B pretax quarterly profit

While its crosstown competitors at General Motors are smarting over a drastic drop in net income to $200 million in the second quarter, Ford has reason to celebrate. The Blue Oval has announced its own Q2 financial results, including a growing net income of $1.3 billion, a $78 million increase over last year. Pretax profits for the company reached $2.6 billion, up $44 million from 2013, but total revenue dropped slightly to $37.4 billion, down from $37.9 billion. Profits per share before one-time charges totaled 40 cents per share, beating Wall Street analysts' expectations of 36 cents a share.
Regionally, the Blue Oval performed strongly, as well. North America posted a record quarterly pre-tax profit of $2.4 billion, a $119 million increase. Europe also showed signs of turn around with its first profit in three years of $14 million after a loss of $306 million in Q2 2013. Ford is actually predicting profitability in the troubled region in 2015. Asia Pacific operations also performed well with $159 million in profits, up $29 million from last year. The only region where the business posted a loss was South America.
According to Automotive News, Ford also announced more precise plans about the changeover to build the aluminum-intensive 2015 F-150. In August, the Dearborn plant will shutdown for eight weeks to retool and its Kansas City plant will do the same next year.

Subprime financing on the rise in new car sales, leasing too

We all remember the financial crisis that began several years back. At its core was a splurge of subprime lending for housing loans. The housing bubble burst, triggering a collapse of the mortgage-backed securities market. Apparently, those types of loans still exist in the automotive industry, and the market share for these types of "nonprime, subprime, and deep subprime," loans has grown 13.6 percent compared to the third quarter a year ago.
According to an Automotive News report, high-risk lending expanded to 24.8 percent of total loans in Q3, up from 21.9 percent for this time last year. As this level increased, average credit scores of borrowers dropped to 755, down from 763 a year ago. In that time, the average financing amount increased $90 per vehicle, to $25,963.
At 818, Volvo maintains the highest per-owner credit score, while Mitsubishi has the lowest, at 694. The highest rate of borrowers was at Toyota, with 14 percent of the market, followed by Ford with 13.1 percent and Chevrolet at 11.1.

Ford recalls 9,900 vehicles across two campaigns

Ford is recalling a total of 9,885 vehicles in two campaigns. The Basics: In one recall, Ford will recall 9,017 examples of the 2013 Escape with build dates from January 11, 2012, to April 1, 2013, and the 2013-2014 Focus ST produced between May 3, 2012, and October 14, 2013. The Problem: Splices in the engine wiring harness might not have enough compression, and this can cause the manifold absolute pressure sensor to send incorrect signals to the powertrain control module. This issue could cause the engine to stall. Injuries/Deaths: None reported. The Fix: Dealers will replace the current crimped splices with new splices, according to the National Highway Traffic Safety Administration. If You Own One: The repair campaign will begin on January 4, 2016. More Information: Ford recalled the 2013 Escape and Focus ST in August 2014 for the same problem, and this is an expansion of that campaign, according to company spokesperson John Cangany to Autoblog. The Basics: In the smaller of the two campaigns, Ford will recall 868 examples of the 2013 Explorer, Explorer Police Utility, Taurus, Taurus Police Interceptor, Flex, Lincoln MKS, and MKT. The Problem: The fuel delivery module can crack, which would cause a fuel leak. Injuries/Deaths: None reported. The Fix: Dealers will replace the fuel delivery module. If You Own One: Owners should receive notice soon because NHTSA's report says the recall begins in December. More Information: According to Cangany, this recall is an expansion of a campaign from 2013 for these vehicles. RECALL Subject : Engine Wiring Splices may cause Stall Report Receipt Date: DEC 02, 2015 NHTSA Campaign Number: 15V813000 Component(s): ELECTRICAL SYSTEM Potential Number of Units Affected: 9,017 All Products Associated with this Recall Vehicle Make Model Model Year(s) FORD ESCAPE 2013 FORD FOCUS 2013-2014 Details Manufacturer: Ford Motor Company SUMMARY: Ford Motor Company (Ford) is recalling certain model year 2013 Escape vehicles manufactured January 11, 2012, to April 1, 2013, and 2013-2014 Focus ST vehicles manufactured May 03, 2012, to October 14, 2013. Insufficient compression in the engine wiring harness splices to the Manifold Absolute Pressure (MAP) sensor may provide incorrect signals to the powertrain control module (PCM). CONSEQUENCE: The incorrect signals could cause the vehicle to hesitate or the engine to stall, increasing the risk of a crash.