Ford said today it earned a profit of $2.7 billion in 2009, a stunning improvement over its historic, $14.7 billion loss in 2008. It's the company's first full-year profit since 2005. But, they're not out of the woods yet.
Don't get us wrong, it's an impressive number, especially for a year that saw industry sales drop to their lowest level since 1982. But it's also not entirely indicative of the financial health of the company. The year-end results were buoyed by a $4.7 billion one-time gain the company booked in the second quarter after recapitalizing a chunk of its debt, and benefited from a total of $2.6 billion in other special items for the year.
Ford's also still losing almost $1.5 billion from the automotive side of the business — which means they'll still need to make cuts if they'll want to survive even given an assumption of U.S. auto industry sales predicted at 11.5-12.5 million vehicles.
But, Ford is predicting that's what they'll do as the company said it now expects to be profitable for full year 2010 on a pre-tax basis excluding special items, for North America, total automotive and total company, with positive automotive operating-related cash flow.
We're just wondering how they'll do that given cutting further into some departments — say, engineering and product R&D — to achieve those savings will definitely hinder new product development. [via Ford]