DETROIT — If you listen closely, you can almost hear the collective sound of Detroit auto executives knocking on wood after third-quarter earnings reports from Ford Motor Co. and Fiat Chrysler Automobiles shattered expectations.
General Motors is expected to announce similarly strong numbers this week, further evidence the Detroit 3 have not only overcome a pandemic that shuttered factories and sank sales but have managed to emerge stronger. Ford achieved its fattest North American profit margins in nearly five years, and FCA earned a record $3 billion in North America.
Ford was confident enough to increase its full-year forecast and repay about $15 billion it borrowed in the spring to weather the crisis, while GM acted sooner than it had promised to reimburse salaried employees for the portion of their pay it started deferring when the pandemic began.
Both Ford and FCA attributed their strong third-quarter profits to higher- than-expected demand and strong pricing on pickups and utility vehicles, factors they hope will buoy results through the end of the year.
But none of the companies is declaring victory quite yet. The potential for additional shutdowns or sales slumps hangs over the industry as coronavirus cases in the U.S. and Europe reach record levels.
“You look around and see where the coronavirus is spiking and the impacts it could have; it is a concern that we have to keep in front of us and have to manage,” Ford CFO John Lawler said. “The thing we can do is continue to keep our people safe and make sure we have all our protocols working very well and to just be vigilant, watch and make sure we’re planning well.”
