Ford sucks up soot

Lo$e now, win later

Ford Motor just flashed a warning to investors that it’s hard to keep profits rolling in a slowing market — while also trying to reinvent your company for an autonomous age.

Profit may fall by half in the first quarter, a bigger drop than analysts predicted, as Ford ratchets back production and spends more to create the selfdriving cars and electric vehicles the company has said will drive its future.

Ford shares in this struggle with auto makers facing declining sales and rising cost storeengineer themselves in a new era of mobility.

Chief Executive Mark Fields has said profits will fall this year before rebounding in 2018 as the company spends big to take on interlopers such as Alphabet’s Waymo and Uber.

“Everything is on the table” as Ford reengineers itself for the future, Chief Financial Officer Bob Shanks told analysts and investors on Thursday.

Ford surprised Wall Street ahead of the New York meeting byforecasting first-quarter adjusted earnings per share may be 30 to 35 cents — well belowthe47-cent average estimate of analysts surveyed by Bloomberg and the 68 cents it earned a year earlier.

Full-year pretax profit will slip to about$9billion fromlast year’s $10.4 billion, with most of the drop-off happening this quarter, Shankssaid in aphone interview before the meeting.

Ford shares slipped 10 cents onThursday, to $11.67.

“This is one of the most significant quarterly misses vs. consensus produced by Ford in quite some time,” Adam Jonas, ananalyst at MorganStanley, wroteinareportThursday.

Automakers are also being hurt by falling used car prices.

Fordtouchedoffskittishness among investors late last year by warning that the drop in used-vehicle prices would affect its financial-services unit this year. Shares of Ford, GM and Fiat Chrysler fell earlier this week after Ally Financial warned profit growth may slowdueinparttoanexpected 5 percent decline in used-car prices this year.

The performance of auto loans and leases will continue to deteriorate this year, as credit losses increase and used-car values fall, Fitch Ratings said Wednesday. The National Automobile Dealers Association’s Used Vehicle Price Index fell 3.8 percent in February from January, the eighth consecutive monthly decline and an 8 percent drop from a year earlier.

Ford has lowered its outlook through 2019 for what it expects used cars to fetch at auctions, due to the glut of models coming off lease over the next few years.