Updated from 8:24 a.m. EDT
, the world's second-largest car manufacturer, on Wednesday reported a 7% drop in third-quarter earnings it blamed primarily on costs related to the Firestone tire
The Dearborn, Mich.-based automaker still managed to narrowly beat revised Wall Street estimates, earning $888 million in the third quarter, or 53 cents per share, down from $959 million, or 78 cents per share, in the same year-ago period. On average, the 15 analysts polled by
First Call/Thompson Financial
had expected Ford to earn 50 cents a share.
Without the costs related to the massive Firestone tire recall, announced in early August, Ford said it would have produced record profits in the third quarter.
"Getting our customers onto good tires has been, and continues to be, more important than short-term profits," said Jac Nasser, Ford president and chief executive, in a statement. "This was a difficult quarter for our customers, our employees, our dealers, and our shareholders and we are committed to quickly completing the Firestone tire recall."
In a filing with the
Securities and Exchange Commission
last month, Ford said it had preliminarily agreed to bear a portion of the
costs of Firestone's recall of 6.5 million tires found to be defective. The company warned then that revenue would likely fall and costs would rise as a result, but said it was too early to assess the overall financial impact at that time.
On Wednesday, the company did not specify how much of its $71 million drop in earnings could be attributed to the fire recall, saying only that the decrease "is more than explained" by the impact of the recall.
Worldwide sales revenue from Ford's cars and trucks grew to $32.6 billion in the third quarter, a 6% increase from the same year-ago period. Total Ford retail sales in the U.S. reached a record 1 million. However, automotive-related capital expenditures rose to $1.93 billion in the same period, up 7% compared to the third quarter of 1999.
Shares of Ford finished Wednesday regular trading up 63 cents, or 3%, at $25.06.
, the world's biggest automaker, said that its third-quarter
profits fell 5.5%, dragged down by losses in the European market.
Net income for the three-month period ending Sept. 30 declined to $829 million from $877 million a year earlier, due in part to the $181 million loss recorded by its European operations. Earnings per share, however, rose more than 16% to $1.55 from $1.33 in the comparable period of last year because of continuing stock repurchases. Wall Street had anticipated earnings of $1.54 a share, according to First Call.