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Ford 2Q profit drops 86% as it restructures overseas

DEARBORN, Mich. (AP) — Ford's net profit tumbled 86% in the second quarter due largely to restructuring costs in Europe and South America. Net income for the April-through-June period dropped to $148 million, or 4 cents per share. Without the charges the company made 28 cents per share. Revenue was flat at $38.9 billion. On average, analysts surveyed by FactSet expected earnings 31 cents per share on revenue of $38.49 billion. Chief Financial Officer Tim Stone says the company had charges of $1.2 billion as it moved to close factories in Europe and South America. He says Ford already is seeing an impact from its global fitness measures that included a reduction of 7,000 white-collar workers. Ford, which released numbers after the markets closed Wednesday, says its results include a $181 million valuation loss on an investment in a software company, trimming 4 cents off adjusted earnings per share. Its stock fell 6.3% in after-hours trading to $9.68. Stone said Ford is in the early stages of its restructuring, but already is seeing improvement in some regions. Free cash flow also improved by 80% to $2.1 billion in the first half of the year, he said. "We're already starting to see some early benefits," he said. "A lot of work to do." The company expects improvement in the second half of the year as more new big SUVs hit dealerships and more of the restructuring takes hold. Ford on Wednesday forecast pretax adjusted earnings of $7 billion to $7.5 billion for all of 2019, compared with $7 billion last year. The company previously had only said that pretax earnings would improve. Full-year adjusted earnings per share are forecast to be $1.20 to $1.35, up from $1.30 in 2018. Previously it did not give per-share guidance. Ford's U.S. sales fell nearly 5% in the second quarter, according to the Edmunds.com auto pricing site, as the company exited most of its passenger car business. But Stone said sales of the new Ford Ranger small pickup offset much of that as its share of the small truck segment rose 14%. Edmunds, which provides content for The Associated Press, said Ford's average vehicle sale price rose 2.8% to $41,328 during the quarter. In North America, Ford's biggest profit center, pretax earnings fell 3% to just under $1.7 billion, which the company blamed on switching its Chicago factory to build new versions of midsize SUVs.

BMW, Hyundai score big in JD Power's first Tech Experience Index

While automakers are quick to brag about winning a JD Power Initial Quality Study award, the reality, as we've pointed out before, is that these ratings are somewhat misleading, since IQS doesn't necessarily distinguish genuine quality issues. JD Power's new Tech Experience Index aims to solve that problem. The new metric takes the same 90-day approach as IQS but focuses exclusively on technology – collision protection, comfort and convenience, driving assistance, entertainment and connectivity, navigation, and smartphone mirroring. It splits the industry up into just seven segments, based loosely on size, which is why the Chevrolet Camaro is in the same division (mid-size) as Kia Sorento and the Mercedes-Benz GLE-Class is in the same segment as the Hyundai Genesis (mid-size premium). It makes for some screwy bedfellows, to be sure. Still, splitting tech experience away from initial quality should allow customers to make more informed and intelligent decisions when buying new vehicles. In the inaugural study, respondents listed BMW and Hyundai as the big winners, with two segment awards – the 2 Series for small premium and the 4 Series for compact premium, and the Genesis for mid-size premium and Tucson for small segment. The Chevrolet Camaro (midsize), Kia Forte (compact), and Nissan Maxima (large) scored individual wins. Ford also had a surprising hit with the Lincoln MKC, which ranked third in the compact premium segment behind the 4 Series and Lexus IS. This is a coup for the Blue Oval, whose woeful MyFord Touch systems made the brand a victim of the IQS' flaws in the early 2010s. But Ford and other automakers might not want to celebrate just yet. According to JD Power, there's still a lot of room for improvement – navigation systems were the lowest-rated piece of tech in the study. Instead, customers repeatedly saluted collision-avoidance and safety systems, giving the category the best marks of the study and listing blind-spot monitoring and backup cameras as two must-have features – 96 percent of respondents said they wanted those two systems in their next vehicle. But this isn't really a surprise. Implementation of safety systems from brand to brand is similar, and they don't require any input from users, unlike navigation and infotainment systems which are frustratingly deep.

2018 Lincoln Navigator First Drive | From black sheep to flagship

This is Lincoln's flagship. It's the most luxurious, comfortable and expensive vehicle the brand sells. It's quite obviously the biggest and heck, like every Lincoln flagship of yesteryear, it even features body-on-frame construction. Crucially, though, this all-new 2018 Lincoln Navigator is also very good. It's distinctive, capable, and competent in ways that will stand up well in the upper echelon of the SUV hierarchy. And we'll get this out of the way now: it's far superior to its primary competitor, the Cadillac Escalade. And yet, the Navigator's flagship status is a comeback story. It wasn't too long ago that it was a black sheep confined to the distant back row of Lincoln family promotional photos along with the Town Car and a fichus added for decoration. It was never given one of the new-fangled MK names, and its V8-powered, truck-based status made it a thirsty dinosaur at a time of rising gas prices and an increasing number of crossovers. Livery services bought them in black-painted droves, but it was otherwise forgotten even as a substantive refresh for 2015 arguably made it a better, more practical bet than its Caddy nemesis. Like its predecessor, and indeed every Navigator since the second generation dawned for 2007, the third-generation 2018 model features an independent rear suspension rather than the live axle in GM's SUVs. First and foremost, this reaps benefits for those sitting in the third row. Full-sized adults enjoy an abundance of room back there on par (or perhaps even better) than a minivan. There's a USB port on each side, the seatbacks power recline and its three seat belts allow for an eight-passenger max. There's even enough room behind the raised third-row for creatively stacked suitcases. Compare this to a regular-wheelbase Escalade with its third row stuck to the sky-high floor; its occupants' knees jammed against the second row and/or stuck into their own chins. It's a wasteland back there, but to be fair, not much worse than an Infiniti QX80 or Lexus LX 570. Yes, the extended-wheelbase Escalade ESV helps, but there's still less space than the standard Navigator. In fact, the Navigator L model offers the exact same third-row – only the cargo area behind it expands. That rear suspension also pays dividends in the ride and handling department.