DETROIT, Oct 30 Reuters Ford Motor stock has tumbled about 8 so far this week after the company faltered on CEO Jim Farley39;s mission to improve efficiency in its traditional gasolineengine operations, whose profits the company needs to fund its expensive electric vehicle plans.
Quality and warranty problems, supplier issues and waste in the automaker39;s 121year legacy business have obscured its progress, Farley told analysts during a call to discuss quarterly earnings Monday. The automaker said annual results would be in the lowest range of its previous outlook.
The biggest opportunity for the company clearly is cost and warranty, Farley said on the call. I39;m proud of the progress but we39;re not satisfied at all, he later added.
Some on Wall Street are concerned about Ford39;s ability to root out these perennial issues, which Farley has highlighted for years. Some investors also chafe at Ford39;s decision to preserve cash and pay a dividend rather than engage in aggressive stock buybacks like Detroit rival GM.
Ford shares are down 13 this year, while rival General Motors is up 43 after consistently raising its outlook this year. Comparing the crosstown rivals as they navigate similar market forces is unavoidable, analysts and investors say.
I wouldn39;t say the results have been horrible at Ford in any one quarter, but second and third quarter definitely had some disappointments, and those disappointments are more magnified this year given how well GMs stock…