DEARBORN, Mich. – Ford posted its best first-quarter profit in 13 years thanks to an improving economy and a lineup of fuel-efficient vehicles that reached showrooms as gasoline prices surged.
New arrivals like the Ford Explorer — which gets 20 percent better fuel economy than the old version — and the 40-miles-per-gallon Fiesta subcompact are selling well in the U.S. Company profits are growing around the world. And Ford is charging more for its cars, helping offset the higher costs of steel and other materials.
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The outlook for the rest of the year is also positive. Ford can likely keep its prices high because of earthquake-related shortages at rivals such as Toyota. Consumer confidence is growing, so buyers are more willing to invest in a new car.
Ford predicts U.S. sales will rebound from a 30-year low of 10.4 million in 2009 to about 13 million this year.
On Tuesday, Ford Motor Co. said net income rose 22 percent to $2.6 billion, its best first-quarter performance since 1998. It was the company’s eighth straight quarterly profit in its long climb back from near-bankruptcy five years ago.
Ford’s revenues rose 18 percent to $33.1 billion. The company saw especially strong growth in Asia, where revenues jumped 31 percent to $2.1 billion. In India, sales more than doubled thanks to the popularity of the $8,000 Figo subcompact.
“Our team delivered a great quarter, with solid growth and improvements in all regions,” said Ford President and CEO Alan Mulally.
With a strong lineup of relatively new small and midsize cars, Ford is in a good position as rising gas prices push drivers into smaller vehicles. The average price of a gallon of gas in the U.S. is now $3.87, up $1.03 from a year ago. Ford’s newest small car, the redesigned Focus, can get up to 40 mpg on the highway.
The average price of a Ford vehicle increased $2,515 to $33,173 in the first quarter, according to auto pricing site TrueCar.com. That was $3,000 more than the average price for the industry.
Ford raised prices to offset the rising cost of steel and other commodities. But Ford also got better prices for its vehicles because it offered fewer discounts.
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