DETROIT (Reuters) - Ford Motor Co's 2017 financial performance will decline from this year's results, because of increased spending on "emerging opportunities" and other costs, the No. 2 U.S.-based automaker said on Wednesday.
Last week, Ford lowered its 2016 pretax profit forecast to $10.2 billion from at least $10.8 billion because of a charge in the third quarter for an expanded vehicle recall.
Ford said it "plans to achieve cost efficiencies averaging $3 billion annually between 2016 and 2018 and is adding new processes like zero-base budgeting to further its business transformation."
This will "offset the vast majority of costs being added to strengthen Ford's business," but will not be enough to offset higher regulatory and vehicle development costs for what it calls emerging opportunities, such as electric vehicles.
Ford disclosed the financial outlook ahead of presentations later in the day to Wall Street analysts in Dearborn, Michigan, where it is headquartered.
Also Read
The automaker said automotive capital expenditures will rise to 5.6 percent of automotive revenue in 2018, from 4.9 percent in 2016. It will decline after 2018, Ford said.
(Reporting by Bernie Woodall; Editing by Jeffrey Benkoe)
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
