Ford expects first quarter losses to total £478m

Ford expects to see losses of $600 million (circa £480m) in the first quarter of 2020, as sales dwindle in the midst of the coronavirus pandemic.

The American firm said first-quarter sales were down 21 per cent compared with the same period last year because of production slowdown and reduced consumer demand driven by local lockdown orders across the globe.

It is currently only producing and selling vehicles in China, where the pandemic took hold earlier and has therefore seen lockdowns eased first. However, Ford is planning for a phased restart of its manufacturing plants and supply network elsewhere in the second quarter of the year, with enhanced safety standards put in place.

Tim Stone, Ford’s chief financial officer, said: “We continue to opportunistically assess all funding options to further strengthen our balance sheet and increase liquidity to optimise our financial flexibility.

“We also are identifying additional operating actions to enhance our cash position. However, we believe we have sufficient cash today to get us through at least the end of the third quarter with no incremental vehicle production and wholesales or financing actions.”

Ford says it has about $30 billion (circa £23.9bn) in cash on its balance sheet, which includes about $15.4bn (circa £12.3bn) of proceeds from borrowings last month against two existing credit lines.

Ford plans to announce its confirmed financial results for the first quarter of 2020 on April 28, when it will also include estimates of the economic effect on the business of the coronavirus pandemic.