Ford Expects $0.7B Remeasurement Gain in Q4, Recalls 272K Vehicles

Ford's Financial Performance - Ford expects a pre-tax remeasurement gain of approximately $0.7 billion in Q4 2024, linked to pension and OPEB plans using mark-to-market accounting [1] - The gain includes a $0.3 billion loss from U.S. pension plans, a $0.9 billion gain from non-U.S. pension plans, and a $0.1 billion gain from global OPEB plans [2] - Higher discount rates are the primary driver of the gain, partially offset by lower-than-expected asset returns [2] - After taxes, the remeasurement is estimated to boost net income by about $0.4 billion, but it will not affect adjusted EBIT or adjusted EPS [3] Pension and OPEB Plans - The remeasurement has no impact on Ford's 2024 cash flow or 2025 pension contribution plans [4] - Ford's funded plans remain fully funded, with underfunded status for pension and OPEB plans projected at $0.5 billion and $4.4 billion, respectively, at the end of 2024 [4] - This compares to $2.3 billion and $4.7 billion at the end of 2023 [4] Vehicle Recall - Ford is recalling 272,817 vehicles in the U.S. due to potential battery failures, including certain 2021–2023 Bronco Sport and 2022–2023 Maverick models [5] - The 12-volt battery may degrade and fail suddenly, potentially disabling electrical accessories or causing a loss of drive power [5] - Dealers will inspect and replace affected batteries at no cost to owners [5] Industry Comparison - Ford currently carries a Zacks Rank 4 (Sell) [6] - Better-ranked stocks in the auto space include Geely Automobile Holdings Limited (GELYY) and Blue Bird Corporation (BLBD) with Zacks Rank 1 (Strong Buy), and Allison Transmission Holdings, Inc. (ALSN) with Zacks Rank 2 (Buy) [6] Competitor Performance - GELYY's fiscal 2025 sales and earnings are expected to grow 66.62% and 149.31% year-over-year, respectively, with EPS estimates for fiscal 2025 and 2026 improving by 15 cents and 38 cents in the past 30 days [7] - BLBD's fiscal 2025 sales and earnings are expected to grow 10.97% and 12.14% year-over-year, respectively, with EPS estimates for fiscal 2025 improving by 18 cents in the past 60 days [7] - ALSN's 2024 sales and earnings are expected to grow 6.10% and 11.89% year-over-year, respectively, with EPS estimates for 2024 and 2025 improving by 2 cents and 3 cents in the past 30 days [8]