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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.

Lincoln to get high-end Harman Revel audio in 2015

"They've never been in autos before, and this is going to be an absolute point of differentiation for us." – Matt VanDyke Lincoln executive Matt VanDyke admits he was "moderately interested" when he heard his brand was considering a partnership with a high-end speaker company. Then he listened to the silky sound they made. "I sat there and I was blown away," he said. That may be overselling the speakers, but they do sound good – we know, we've checked 'em out. Lincoln is betting subtle enhancements – like Harman's Revel audio systems – will help the historic automotive brand appeal to a new generation of buyers. The companies announced a 10-year deal on Wednesday to place Revel speakers in Lincoln cars and trucks beginning in 2015 models. Terms were not disclosed. Though Revel is a new name, Harman has long offered a wide array of car under other brands, including Harman Kardon, Infinity and Lexicon. The partnership launches with the next-generation MKX crossover (concept version shown above), which arrives in showrooms in 2015, and the speakers will be available on other Lincoln models, too. Revel is Harman's top-of-the-line brand that's marketed to audiophiles, and its home systems can easily cost several thousand dollars or more. In Lincolns, passengers will be able to tune their Revel system to three settings: normal stereo sound; "audience," which creates concert-like acoustics; and "on-stage," which is designed to make passengers feel like they're standing among the band. Revel and Lincoln designers also collaborated on the style of the speaker grilles to integrate them into the vehicles, and the uplevel Revel system, called Ultima, will use aluminum covers. "They've never been in autos before, and this is going to be an absolute point of differentiation for us," said VanDyke, Lincoln's global director. Though Revel is a new name to the auto sector, Harman has long offered a wide array of in-car audio and infotainment systems under other brands, including Harman Kardon, Infinity and Lexicon. The Revel partnership is part of Lincoln's efforts to elevate its image and make the brand more relevant to new and younger customers. Lincoln's Black Label line, a customization and service program, will launch at 32 dealerships in six states this year, before expanding nationwide in late 2015. Additionally, Lincoln signed Oscar-winner Matthew McConaughey to star in its advertisements.

Here are a few of our automotive guilty pleasures

It goes without saying, but I'll say it anyway. The world is full of cars, and just about as many of them are bad as are good. It's pretty easy to pick which fall into each category after giving them a thorough walkaround and, more important, driving them. But every once in a while, an automobile straddles the line somehow between good and bad — it may be hideously overpriced and therefore a marketplace failure, it may be stupid quick in a straight line but handles like a drunken noodle, or it may have an interior that looks like it was made of a mess of injection-molded Legos. Heck, maybe all three. Yet there's something special about some bad cars that actually makes them likable. The idea for this list came to me while I was browsing classified ads for cars within a few hundred miles of my house. I ran across a few oddballs and shared them with the rest of the team in our online chat room. It turns out several of us have a few automotive guilty pleasures that we're willing to admit to. We'll call a few of 'em out here. Feel free to share some of your own in the comments below. Dodge Neon SRT4 and Caliber SRT4: The Neon was a passably good and plucky little city car when it debuted for the 1995 model year. The Caliber, which replaced the aging Neon and sought to replace its friendly marketing campaign with something more sinister, was panned from the very outset for its cheap interior furnishings, but at least offered some decent utility with its hatchback shape. What the two little front-wheel-drive Dodge models have in common are their rip-roarin' SRT variants, each powered by turbocharged 2.4-liter four-cylinder engines. Known for their propensity to light up their front tires under hard acceleration, the duo were legitimately quick and fun to drive with a fantastic turbo whoosh that called to mind the early days of turbo technology. — Consumer Editor Jeremy Korzeniewski  Chevrolet HHR SS: Chevy's HHR SS came out early in my automotive journalism career, and I have fond memories of the press launch (and having dinner with Bob Lutz) that included plenty of tire-smoking hard launches and demonstrations of the manual transmission's no-lift shift feature. The 260-horsepower turbocharged four-cylinder was and still is a spunky little engine that makes the retro-inspired HHR a fun little hot rod that works quite well as a fun little daily driver.