Ford’s Net Income Drops 39%

Ford Motor Co.'s first-quarter net earnings fell to $989 million from $1.6 billion in January-March 2013. Revenue was virtually flat at $35.9 billion.

The company's pretax profit for the quarter dropped 35% to $1.4 billion. But Ford affirms its expectation of full-year pretax profit between $7 billion and $8 billion compared with $8.6 billion in 2013.

Ford says recall expenses, increased warranty reserves and weather-related costs resulted in a $900 million reduction in first-quarter pretax results.

Unit sales grew 6% worldwide to nearly 1.6 million vehicles. Volume climbed 11% to 326,000 units in Europe and soared 45% to 271,300 units in China. Sales slipped 2% to 580,300 units in the U.S.

Ford's pretax profits plunged 37% to $1.5 billion in North America. But Asia-Pacific operations reversed last year's first-quarter loss of $28 million with a record $291 million pretax profit.

The company's pretax loss in Europe shrank 54% to $194 million. Its losses more than doubled to $510 million in South America.