Ahead of Ford (F) posting Q3/2023 results, the firm settled with the United Auto Workers. It offered a 25% wage hike. The attempt to announce good news proved a bad sign. Ford stock fell a historic 12.25% on Oct. 27, 2023. Its Q3 results missed expectations. Uncertainty is very high as it withdrew its 2023 guidance.
Like GM, Ford withdrew its guidance. The firm blamed a pending ratification of its tentative agreement with the UAW. Ford’s accounts could have attempted to offer an operating expenditure range. In reality, a weak outlook in its electric vehicle segment is a troubling development.
Ford earned 39 cents a share or $1.2 billion in net income in Q3. Revenue was $43.8 billion. The firm recorded an EBIT loss of $1.3B from its EV segment. To slow its losses, Ford pushed out its capital expenditures of $12 billion. Demand for EVs is too low to justify its spending commitments. Still, the company assured analysts that it will adjust its capital allocation through 2030. It will respond to demand levels, which are currently very weak.
It faces a serious price war among EV suppliers. Tesla (TSLA) is likely growing its market share the most, taking sales away from Ford.
Beware of Ford stock.
$10 is the new resistance price, with more downside risks to follow.
