Ford Motor Co.
) announced its plan to invest $135 million to develop key
components, including advanced battery systems, for its
next-generation hybrid-electric vehicles.
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The automaker is looking forward to double its battery-testing
capabilities to 160 individual battery-test channels by 2013. It
aims to boost development of hybrid-electric vehicles by at least
The company will utilize its 285,000-square-foot research and
development lab, Ford Advanced Electrification Center, in Dearborn,
Michigan to focus almost entirely on hybrids and electric vehicles.
Presently, 1,000 engineers are working on hybrid and
electrification programs at the facility, formerly known as
Advanced Engineering Center.
Ford aims to reduce cost of its current hybrid system by 30%
compared with its previous-generation system. The company plans to
launch five fuel-efficient hybrid-electric vehicles this year
including Focus Electric, C-MAX Hybrid, C-MAX Energi plug-in
hybrid, new Fusion Hybrid and Fusion Energi plug-in hybrid. It also
plans to triple production capacity of electrified vehicles by
Ford's focus on hybrid vehicles and fuel-efficiency played a
pivotal role in its revival since late 2006. Last year, the company
had signed a memorandum of understanding with
Toyota Motor Corp.
) on the equal product development collaboration in order to
develop a gas-electric hybrid engine for pickup trucks and sport
utility vehicles (SUVs). However, both the automakers had decided
to retain the uniqueness in their products.
The automakers had decided to sign a definitive agreement this year
that would lay out timelines to develop the technology. They expect
to market the product by the end of this decade.
The development of electric hybrid engines would help both the
companies meet stringent fuel economy and pollution standards in
the U.S. and elsewhere in the near future. The U.S. fuel economy
standards require vehicles to deliver 56.5 miles per gallon (mpg)
Ford, a Zacks #4 Rank (Sell) stock, posted a 39% fall in profits of
$1.20 billion or 30 cents per share in the second quarter of the
year from $1.98 billion or 49 cents in the corresponding quarter of
2011 due to lower operating results in all the regions except North
America. However, the company's profits were higher than the Zacks
Consensus Estimate of 28 cents per share.
Revenues in the quarter dipped 6% to $33.3 billion, due to the same
factors mentioned above. However, it exceeded the Zacks Consensus
Estimate of $32.0 billion. In the first half of the year, Ford's
U.S. total market share was 15.4% in the U.S. and 8.1% in Europe.
For 2012, Ford anticipates market share in the U.S. and Europe to
be lower than 16.5% and 8.3%, respectively, in 2011. It also
expects the overall pre-tax operating profit to be lower than 2011
compared with the prior guidance of tallying. Operating margin in
the Automotive segment is anticipated to be equal or lower rather
than the prior guidance of improve over 5.4% in 2011.