Ford Warns 2027 Profit Will Plateau as Iran-War Inflation Adds a $2 Billion Headwind

Ford reported third-quarter results on October 28 that beat Wall Street estimates, then used the earnings call to warn that next year will not build on them. Third-quarter company-wide revenue fell 2% to $49.5 billion, net income declined to $2 billion from $2.4 billion a year earlier, while adjusted EBIT increased to $2.7 billion from $2.6 billion. Adjusted earnings of 49 cents per share exceeded the roughly 39–40 cent consensus, and automotive revenues of $46.08 billion beat the $45.67 billion consensus. Ford raised the lower end of its 2026 adjusted EBIT guidance to $10.5–11 billion, from $10–11 billion, with adjusted free cash flow guidance held at $6–7 billion.

The 2027 outlook is where the call turned cautious. Chief executive Jim Farley said 2027 adjusted EBIT will be roughly in line with 2026, and chief financial officer Sherry House said the company is not expecting relief any time soon from commodity inflation. Ford raised its 2026 commodity-cost headwind estimate to nearly $2.5 billion, from about $2 billion, citing more expensive copper, steel, fuel and chips, and said inflation stoked by the war in Iran will add a $2 billion headwind next year through higher logistics, raw-material and chip costs, with a further $2 billion in additional commodity, memory and logistics pressures expected in 2027. The plan to offset it is cost cuts plus growth in batteries, software and services, targeting an 8% adjusted EBIT margin by 2029.

The divisional picture shows where the pressure lands. Ford Blue, the traditional internal-combustion and hybrid business, earned about $1.4 billion before interest and taxes, down 10% from a year earlier, hurt by lower sales tied to discontinued models such as the Escape and by war-related costs. Ford Pro, the commercial division, generated $1.7 billion in quarterly EBIT, down 16%, on higher commodity costs and temporary Oakville production-launch costs for Super Duty pickups, though it still expects $7 billion in full-year EBIT. The bright spots were trucks: U.S. quarterly deliveries totaled 509,764 vehicles, down 6.6% on planned portfolio changes, but adjusted retail market share rose 0.4 points to 12.1%, Maverick Hybrid sales rose 59.6% to a record 27,793, and Super Duty production rose 4.4% to 110,275 trucks, its strongest quarterly result in 19 years.