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Ford Says Inflation-related Q3 Supply Costs $1.0 Bln Above Plan

Ford Motor Co. (F) said inflation and parts shortages will leave the company with more unfinished vehicles than it had expected. The inflation-related supplier costs during the third quarter will run about $1.0 billion higher than originally expected. But the company again affirmed its expectation for full-year 2022 adjusted earnings before interest and taxes.

Ford noted that the supply shortages will result in a higher-than-planned number of "vehicles on wheels" built but remaining in its inventory awaiting needed parts, at the end of the third quarter. The company believes that those vehicles - an anticipated 40,000 to 45,000 of them, largely high-margin trucks and SUVs - will be completed and sold to dealers during the fourth quarter.

According to the company, based on recent negotiations, inflation-related supplier costs during the third quarter will run about $1.0 billion higher than originally expected.

Ford now anticipates third-quarter adjusted EBIT to be in the range of $1.4 billion and $1.7 billion.

The company again affirmed its expectation for full-year 2022 adjusted earnings before interest and taxes of between $11.5 billion to $12.5 billion, despite limits on availability of certain parts as well as higher payments made to suppliers to account for the effects of inflation.

The company plans to announce full third-quarter 2022 financial results on Wednesday, October 26.

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