Ford Motor Co.'s surprisingly strong quarterly earnings capped a day of upbeat news that showed the U.S. economy continuing to gain strength in key sectors including manufacturing and housing.
The only U.S. automaker to avoid bankruptcy this year, Ford on Monday reported a nearly $1 billion profit from July to September, helped by cost-cutting, the government cash-for-clunkers program and strong demand for its new F-150 pickups.
But Ford's strengthening financials underscore the major weakness plaguing the nascent economic recovery. Ford is gearing up to build more vehicles in the U.S. but has no plans to hire more workers to do it.
That's weighing on the Obama administration which is grappling with rising U.S. unemployment even as the overall economy has returned to growth. President Barack Obama gathered with business leaders and other members of his Economic Recovery Advisory Board on Monday in Washington to help develop ways for the public and private sectors to work together to reverse the job losses. He called for "bold, innovative action."
"Having brought the economy back from the brink, the question is how are we going to make sure that people are getting back to work and able to support their families," Obama said as he convened the group's second meeting, broadcast live on the Internet.
Obama noted last week's announcement that the economy grew at a 3.5 percent annual rate in the third quarter of the year, signaling the unofficial end of the deep recession.
There were more positive developments Monday. Pending sales of existing homes rose for the eighth-straight month in September, rising 6.1 percent, the National Association of Realtors said. September also was good for the building industry, as U.S. construction spending had its largest gain in a year, the Commerce Department said. The key gauge of manufacturing, the Institute for Supply Management's factory index, jumped more than expected last month, rising to a three-year high.
And there was the unexpected profit at Ford. The automaker reported net income of $997 million, or 29 cents a share, for the three months ended Sept. 30. That compared with a net loss of $161 million, or 7 cents a share, in the same quarter a year ago.