Ford Motor Co on Friday said it is still "on track" to reach its mid-decade earnings goal, but the rate of growth will slow this year and rising health care costs are a concern.
As part of Ford's turnaround plan announced in early 2002, the second-largest US automaker set a target of reaching $7 billion in pre-tax profits, excluding special items, by mid-decade, which it defined as the end of 2006.
"Overall, while conditions may slow our rate of improvement in 2004, we believe we are on track to achieve our goal of $7 billion in pre-tax profits, excluding special items, by year-end 2006," Ford said in a regulatory filing.
Ford said that improved results from Ford Europe, the launch of new cars, improved vehicle quality and cost cuts will boost earnings this year.
The automaker said in January that it expected a profit this year of $1.20 to $1.30 per share, or pre-tax profit of $3.5 billion to $3.8 billion excluding one-time items of about $300 million.
For 2003, Ford reported net earnings of $495 million, or 27 cents per share, up from a net loss of $980 million, or a loss of 54 cents per share.
However, Ford said that it is still a year away from introducing some new vehicles designed to compete in the current pricing environment of high incentives. Ford is about two years away from having those vehicles in significant volume.