(F - Get Report)
said today that new products will enable its momentum to continue this year, despite a slowing economy and about $1 billion in added costs.
"We see the global economy improving, but obviously it is uneven," said Mark Fields, Ford president for the Americas, at an investor conference Thursday. "We do expect global growth to continue going forward."
China and India will grow, the U.S. will grow moderately and Europe is "a little bit of a worry spot," he said.
Ford will replace about 30% of its volume this year, said Fields, noting that "our replacement rate is at the top or right near the top of the industry [and] our approach is to make sure pipeline continues to remain full." He declined to specify a ceiling for Ford market share, which has climbed to 16.7% year-to-date from a low of 14.2% in 2008. During the past three decades, Ford's high point was 25.5% in 1996.
Market share gains and increased pricing power will help to offset Ford's anticipated $1 billion in new costs this year, partially due to higher commodity costs and higher costs associated with volume increases and new product introductions. Ford's big three introductions in 2010 include a new power train for the F-150 pickup, a new Ford Explorer (below) and the new Focus.
Another headwind reflects the slowdown in the acceleration of used car prices, which benefitted Ford Credit significantly in the first half of the year but "will tail off a bit in the second half," said Fields. Ford Credit profit growth is expected to slow in the second half.
CFO Louis Booth has said that
Ford will be profitable this year
despite the cost increases. The company has also said it will generate sufficient cash to continue paying down debt to the point that it will move from an automotive net debt position to a
net cash position.
That means the company will have more cash than debt by the end of 2011.
Ford stock was down four cents to $11.76 in early afternoon trading.
-- Written by Ted Reed in Charlotte, N.C.
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