Ford's Earnings Tumble a Real Archaeological Dig

• Ford reports a significant earnings miss in Q4, the largest in four years, attributed to unexpected tariff costs and supply chain disruptions.
• Despite the setback, Ford projects a strong rebound in 2026, with substantial growth in EBIT and free cash flow.
• The "Model e" electric vehicle unit faces considerable losses, offset by the robust performance of the "Ford Pro" fleet business and traditional "Blue" operations.
• Special charges related to EV plans contribute to a net loss, highlighting the challenges and strategic shifts in Ford's electric vehicle endeavors.

Raiders of the Lost Profit

Well, hello there. Indiana Jones here, reporting live from… well, metaphorically speaking, the dusty archives of Ford Motor Company's latest earnings report. Turns out, even global giants can stumble, much like I have in countless ancient temples. Ford's Q4 earnings missed expectations by a mile, a whopping 32% below consensus. It's the first time they've had such a quarterly miss since 2024. Clearly, something went wrong during this expedition.

The Tariff Trap

It appears Ford has been ensnared by a classic villain: tariffs. These unexpected costs amounted to a staggering $900 million. According to Ford, credits for auto parts didn't kick in as quickly as they hoped. I've faced booby traps less insidious than this. Speaking of traps, have you seen what's happening over at Linde? [CONTENT] This reminds me of that time in Nepal; I really put my foot in it, thankfully I could recover in time. If you want to know more about the recovery, check this article out: Linde's Quiet Domination Industrial Gas Giant Surprises.

The Novelis Nightmare

As if tariffs weren't enough, a fire at a Novelis aluminum supplier plant added fuel to the financial flames. The disruption from this incident is expected to cost Ford a pretty penny, with full operations not anticipated until mid-year. This plant is crucial for Ford's F-Series pickup trucks, a vehicle line so popular it's practically a modern-day chariot. As I always say, 'Why did it have to be snakes' Oh wait, this time it's aluminum!

2026: A New Hope

But fear not, intrepid investors! Ford is charting a course for a major rebound in 2026. They're projecting an adjusted EBIT between $8 billion and $10 billion, and adjusted free cash flow between $5 billion and $6 billion. That's a fortune worthy of King Solomon's mines. However, as any treasure hunter knows, the path to riches is fraught with peril. Time will tell if Ford can navigate these treacherous waters.

EV Losses and Fleet Fortunes

The electric vehicle sector, or "Model e" as Ford calls it, is expected to face losses between $4 billion and $4.5 billion this year. Ouch. That's a bigger dent than I put in that Nazi staff car back in Cairo. On the bright side, Ford's traditional and fleet operations are expected to pick up the slack, with the "Ford Pro" fleet business leading the charge with pre-tax earnings between $6.5 billion and $7.5 billion.

Digging Deeper: The Big Picture

On an unadjusted basis, Ford's net loss of $8.2 billion last year was their largest since the Great Recession in 2008. They attributed much of this to special charges related to pulling back on their all-electric vehicle plans. Automakers often exclude these one-time charges to provide a clearer picture, a tactic as old as the hills, or perhaps even older than the Hovitos gold idol. One thing is clear: the automotive landscape is changing, and Ford, like any good explorer, must adapt or risk being left behind. After all, it's not the years, honey, it's the mileage.