Ford warns investors of an additional $1 billion in supply chain costs in the third quarter

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2023 Ford F-150 Raptor R

Ford

DETROIT — Ford Motor warned investors Monday that the company expects to incur $1 billion more in costs in the third quarter than previously expected due to higher costs and supply chain issues.

Ford said delivery problems have resulted in a parts shortage of about 40,000 to 45,000 vehicles that have been unable to reach dealers.

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The company expects to complete and deliver the vehicles to dealers in the fourth quarter and still forecast 2022 adjusted earnings before interest and taxes of between $11.5 billion and $12.5 billion.

The company’s shares fell about 5% in extended trading after the update.

Ford said, based on recent negotiations, inflation-related supplier costs will be about $1 billion higher than originally expected in the third quarter.

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The automaker expects adjusted earnings for the third quarter before interest and taxes to be between $1.4 billion and $1.7 billion.

The company said executives will “add more dimension to expectations for full-year performance” when the automaker reports its third-quarter results on Oct. 26.

Automakers have struggled with supply chain problems since the coronavirus pandemic brought production to a standstill in early 2020. Demand remained strong, followed by continued issues with parts availability, especially semiconductor chips.

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