Ford Motor stated on Wednesday its fourth-quarter results will be impacted by a pre-tax loss of about $2.2 billion because of higher contributions to its employees pension plans.
The charge is heavily related to a fall in discount rates, the company stated, as that results in an increase in the amount of money to be contributed to future pension benefits.
The U.S. automaker stated it will record a $2 billion loss associated with pension plans outside the United States and a $600 million loss connected with other post-retirement employee benefits plans worldwide.
However, the total loss was offset by a $400 million gain related to pension plans in the United States.
On an after-tax basis, the loss is expected to decrease Ford’s net income by about $1.7 billion in the fourth quarter. The loss will not affect the adjusted earnings per share as it is a special item, the company stated.
