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Rising aluminum costs cut into Ford's profit

When Ford reports fourth-quarter results on Wednesday afternoon, it is expected to fret that rising metals costs have cut into profits, even as rivals say they have the problem under control. Aluminum prices have risen 20 percent in the last year and nearly 11 percent since Dec. 11. Steel prices have risen just over 9 percent in the last year. Ford uses more aluminum in its vehicles than its rivals. Aluminum is lighter but far more expensive than steel, closing at $2,229 per tonne on Tuesday. U.S. steel futures closed at $677 per ton (0.91 metric tonnes). Republican U.S. President Donald Trump's administration is weighing whether to impose tariffs on imported steel and aluminum, which could push prices even higher. Ford gave a disappointing earnings estimate for 2017 and 2018 last week, saying the higher costs for steel, aluminum and other metals, as well as currency volatility, could cost the company $1.6 billion in 2018. Ford shares took a dive after the announcement. Ford Chief Financial Officer Bob Shanks told analysts at a conference in Detroit last week that while the company benefited from low commodity prices in 2016, rising steel prices were now the main cause of higher costs, followed by aluminum. Shanks said the automaker at times relies on foreign currencies as a "natural hedge" for some commodities but those are now going in the opposite direction, so they are not working. A Ford spokesman added that the automaker also uses a mix of contracts, hedges and indexed buying. Industry analysts point to the spike in aluminum versus steel prices as a plausible reason for Ford's problems, especially since it uses far more of the expensive metal than other major automakers. "When you look at Ford in the context of the other automakers, aluminum drives a lot of their volume and I think that is the cause" of their rising costs, said Jeff Schuster, senior vice president of forecasting at auto consultancy LMC Automotive. Other major automakers say rising commodity costs are not much of a problem. At last week's Detroit auto show, Fiat Chrysler Automobiles NV's Chief Executive Officer Sergio Marchionne reiterated its earnings guidance for 2018 and held forth on a number of topics, but did not mention metals prices. General Motors Co gave a well-received profit outlook last week and did not mention the subject. "We view changes in raw material costs as something that is manageable," a GM spokesman said in an email.

2015 Ford Edge debuts with fresh tech inside and out

Edge will be the first Ford-badged product to come standard with EcoBoost power.
Ford officially unveiled the all-new, third-generation Edge today at its Dearborn home, announcing that the latest version of the popular crossover will ride on the same CD4 architecture that underpins the Ford Fusion and Lincoln MKZ. The Edge will also be the first Ford-badged product to come standard with EcoBoost power.

Ford supports bid for Detroit Rallycross race with Motown-minded Fiesta ST vid

As Ford continues its cheerleading effort to help bring the 2014 Summer X Games to its hometown of Detroit, MI, it has released footage of its 2014 Fiesta ST Rallycross car on location at some of the city's well-known landmarks. This video appears to have been shot around the same time as the previous X Games Detroit video was made, but it focuses 100-percent on rally car action.
With Ford Racing driver Andreas Eriksson behind the wheel, this Fiesta ST lays down some serious rubber atop Detroit's Cobo Hall parking structure, at Belle Isle and around the Michigan Central Depot. Detroit isn't alone in the bid for a three-year X Games contract as Chicago, Austin and Charlotte are also hoping to play host. The winning host city is expected to be announced this summer. Scroll down for Ford's two-minute video showing the Fiesta ST Rallycrossing through the Motor City.