Ford Motor Company (NYSE: F)‘s net income down 9% to $2.0 billion in the second quarter as the company struggled with flattening U.S. sales and a tougher market in China. Shares of Ford decreased 9.65% to $12.52 on Thursday morning.
The Dearborn, Mich., auto maker has been banking on strong profits in the wake of the recent launch of a new F-150 pickup and revisions to several SUVs. The sustained run of low gasoline prices has disproportionately benefited domestic auto makers that have long dominated the light-truck market.
However, Ford had trouble keeping up with last year’s second-quarter performance, which was helped by the F-150 launch being at its peak. Even the company’s turnaround in Europe is reaping substantial profits, weakness in the Asia Pacific region and South America made it difficult to offset the setback in North America.
According to the earnings announcement, profit decreased 4% to $0.52 per share compared with a profit of %0.54 per share in the same quarter last year. This result missed Wall Street expectation of $0.60 per share profit. Revenue increased 6% to $39.5 billion which beat anaysts’ expectation of $37 billion. Ford’s automotive operating margin down from 8.4% in the second quarter last year to 7.7% this quarter. At the same time, the company’s North American operating margin decreased from 12.2% to 11.3%.
Moreover, Ford’s Asia Pacific region swung to an operating loss of $8 million with profits dented by weaker sales and a market share slide in China. South American losses widened to $265 million from $185 million in the second quarter last year.
“We’re seeing elevated economic risk for the most part globally, and particularly, in what is happening with Brexit,” said Robert Shanks, CEO of Ford Motor Company, speaking to reporters Thursday at the company’s headquarters.