News - Ford - Territory
Ford posts big loss
Redundancies and sales drop put blue oval in red ink
21 May 2007
FORD Australia has posted its biggest loss since 1993.
The company reported an after-tax loss of $40.3 million for the 2006 calendar year.
The loss came after four years of profit for the Campellfield-based operation, which included profits of $192.3 million in 2004 and $148.2 million in 2005.
Ford Australia said the 2006 loss included both significant amounts of investment for the next-generation Falcon as well as one-off costs associated with redundancy packages following cutbacks at its Geelong and Campbellfield factories.
The company sold 14,175 less cars than it did in 2005 as its market share dropped by 1.2 percentage points to 11.9 per cent.
Ford Australia president Tom Gorman admitted 2006 was tough.
From top: Fiesta, Focus and Falcon XT (below).
“This was an extremely challenging year for Ford in Australia,” Mr Gorman said.
“Numerous external factors had an impact on our overall business, including consumer demand moving away from large family sedans, which drove a reduction in our sales volume.”
He said the 2006 figure was affected by cuts at Ford’s Victorian plants, which were made as production rates were wound back to match sliding sales.
“To counter this shift, we embarked on decisive actions to realign our workforce and better position Ford Australia for the future, which resulted in a significant one-time restructuring cost,” Mr Gorman said.
“However, Ford remains committed to investment in future products, such as the new Falcon that’s due for release next year.”
Ford Australia has made a profit in all but three of the last 10 years.
The company lost $16.1 million in 2000 and $5.5 million in 2001 as it paid the price for poor sales of the AU Falcon while investing heavily in its successful replacement, the BA and the Territory, which arrived in 2002 and 2004 respectively.
Ford Australia then bounced back to record a $20.4 million profit in 2002, a $154.6 million profit in 2003 and a profit of $192.3 million in 2004.
The last loss to exceed the $40.3 million figure of 2006 was the 1993 loss of $45.3 million, which came after losses of $38.3 million in 1992 and $113.8 million in 1991.
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