Ford Motor Co. (NYSE:F) is up on first-quarter results that beat analyst expectations and word that the automaker largely will have moved away from selling slow-moving sedans in North America by the next decade.
"We are committed to taking the appropriate actions to drive profitable growth and maximize the returns of our business over the long term,” Jim Hackett, Ford president and CEO, said. “Where we can raise the returns of underperforming parts of our business by making them more fit, we will. If appropriate returns are not on the horizon, we will shift that capital to where we can play and win."
Specifically, Ford said that by 2020 almost 90% of the Ford portfolio in North America will be trucks, SUVs and commercial vehicles.
"Given declining consumer demand and product profitability, the company will not invest in next generations of traditional Ford sedans for North America," Ford stated.
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Instead, the Ford car portfolio in North America will transition to two vehicles –- the best-selling Mustang and the all-new Focus Active crossover coming out next year.
Ford said it also is exploring what it called new “white space” vehicle silhouettes "that combine the best attributes of cars and utilities, such as higher ride height, space and versatility."
Though Ford's first-quarter earnings seemed secondary to those revelations, they were better than analysts expected.
Ford said its net income in the quarter was up nearly 9.5%, to US$1.74bn, or US$0.43 a share, from US$1.59bn, or US$0.40 a share. Yahoo Finance put the average estimate of analysts at US$0.41 a share.
Revenue at Ford increased 7%, to US$41.96bn from US$39.15bn. Yahoo Finance put the average estimate of analysts at US$37.16bn.
In mid-morning trading, shares of Ford were up around 2.5%, at US$11.40.