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Ford Motor stock pops on reinstated outlook, new UAW deal expected to cost $8.8 billion
Ford Motor stock pops on reinstated outlook, new UAW deal expected to cost $8.8 billion By Investing.com
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AuthorSenad KaraahmetovicStock Markets
Published Nov 30, 2023 06:54AM ET
© Reuters. Ford Motor (F) stock pops on reinstated outlook, new UAW deal expected to cost $8.8 billion
Ford (NYSE:F) has reinstated its 2023 financial guidance, still anticipating adjusted Ebit in the range of $10.0 billion to $10.5 billion.
As a result, shares rose modestly in pre-market Thursday trade.
The Michigan-based automaker also disclosed that the new U.S. labor agreement with the UAW is projected to incur costs of $8.8 billion over the life of the contract.
“This industry is going through the biggest technology-led transformation we’ve ever seen and some companies, new and old, are going to be left behind,” Ford CFO John Lawler said.
“Ford+ is the right strategy to win – we’ve got a highly talented team that allocates capital with great discipline, so that we’re executing with consistency, generating strong growth and profitability, and are less cyclical.”
Within this, gross wages, accelerated wage progression, and cost of living adjustments are identified as the three largest components contributing to the total.
Furthermore, the labor pact’s effect is expected to cost approximately $900 per vehicle by 2028.
Ford withdrew 2023 financial guidance in late October during the UAW strike of certain U.S. operations.
The company aims for adjusted free cash flow between $5.0 billion and $5.5 billion for the year.
Ford Motor stock pops on reinstated outlook, new UAW deal expected to cost $8.8 billion
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