The auto industry has been hit hard by the global pandemic, resulting in crucial supply shortages, mainly of semiconductor chips, and a workforce sometimes forced to remain at home due to illness. But there is light at the end of the tunnel and it starts now, at least for Ford.
The Dearborn, Michigan-based automaker has just announced its fourth-quarter earnings from last year and the figures are very impressive. Ford's net income increased to $12.3 billion, a remarkable jump compared to the $2.8 billion loss it suffered only one year prior. This income was still achieved despite ongoing production and supplier issues. But there was another key reason for the success. Ford's investment in Rivian, the EV truck and SUV company that went public only in November, has resulted in an $8.2 billion gain over its initial investment.
It's no wonder Ford just pledged to invest $20 billion over the next five-to-10 years to expand EV production. That's on top of the $29 billion it announced almost one year ago for EVs. The last three months of 2021 also saw adjusted earnings of $2 billion before taxes and interest. That's a 19 percent increase from the same time the year before. Fourth-quarter 2021 revenue spiked by 5% to $37.7 billion. For all of 2021, Ford reports a net income of $17.9 billion. Its full-year earnings in North America alone brought a $7.4 billion profit.
"Financial performance is obviously critical," said President and CEO Jim Farley. "We're also proud that customers see how Ford is taking EVs mainstream, and have already ordered or reserved more than 275,000 all-electric Mustang Mach-E SUVs, F-150 Lightning pickups, and E-Transit commercial vehicles - and we're breaking constraints to deliver every one of them as fast as we can."
Also according to Farley, Ford was the No. 2 seller of EVs in the US last year, which he called "an important early step toward eventually being the true EV leader." Ford says it ended the final business quarter of 2021 with $36 billion in cash and $52 billion in liquidity. Both figures take into account the Rivian investment. As 2021 came to a conclusion, Rivian was valued at $10.6 billion but, as of February 2, its value dropped to $6.6 billion.
Looking ahead to 2022, Ford expects Bronco and Maverick demand to increase, along with EVs like the Mustang Mach-E and F-150 Lightning. Assuming there are no major Covid-related shutdowns or related issues, the Blue Oval is on track for a very profitable year.