Business

Jim Hackett, CEO Says Ford Motor Company (NYSE:F) has to Put in Lot More Efforts to Be Fit

Mr. Jim Hackett, the chief executive officer of Ford Motor Company (NYSE:F) said the company has not done enough to fit in the market when compared to peers. However, he has not disclosed the plans how he will be turning the world’s top motor company into a profitable one.

The company is not ready to increase the commodity prices and but identified the areas for enhancing savings. The company has to put in considerable efforts to follow the profit path in 2018 offsetting the raising commodity prices.

In a conference call on Wednesday after releasing the Q4 and full year earnings of 2017, Mr. Hackett said he is proud of the earnings and the world’s second largest automaker has not yet done enough to stay fit in the market. However, the company is not under pressure from increasing commodity prices.

The growth of Ford has hindered in the recent quarters owing to the unfavorable forex rates and higher commodity prices. After taking charge as CEO in 2017, Mr. Hackett is attempting to steer the company to a profitable path.

The annual spending on the commodity is estimated at $10 billion and a large chunk of it goes to aluminum and steel. The falling prices of the commodity in 2015 and 2016 have contributed to earnings of Ford. But, the prices of the commodity to continued to soar from the end of 2016 and expected the same trend through 2018.

A major portion of Aluminum is utilized in SUVs and trucks. According to Mr. Bob Shanks, the Chief Finance Officer at Ford, steel is playing a spoil sport when coming to the profits.

The revenues of Ford are likely to be moderately higher or flat in 2018 when compared to the earnings in 2017. The company expects lower profits from the Credit Business and lower to flat profits from the automotive segment.

The company has earmarked $7.5 billion for spending in 2018. The company is pumping in its profits into the self driving cars, which is one of the new initiatives for growth.