Ford posts $8.2 billion gain in fourth quarter on investment in Rivian

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The Ford logo is pictured at the Frankfurt Motor Show (IAA) 2019 in Frankfurt, Germany. REUTERS/Wolfgang Rattay/File Photo

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Jan 18 (Reuters) – Ford Motor Co (FN) said on Tuesday its fourth-quarter results would include an $8.2 billion gain on its investment in Rivian Automotive Inc (RIVN.O), following the successful debut of the electric vehicle manufacturer on the market in November. .

Rivian had soared as much as 53% to cross $100 billion in the biggest initial public offering of 2021, but shares of the company have fallen more than 27% since then. Read more

The stock closed down 8.5% on Tuesday after hitting its lowest level since the IPO amid a broader tech sell-off on Wall Street.

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Ford, an early investor in Rivian, currently owns about 12% of the California-based company and has itself embarked on a race to electrification by moving away from traditional gas-powered cars as demand for transportation green increases.

It has pledged to invest more than $30 billion in electric vehicles by 2030. read more

In 2019, the 118-year-old Detroit automaker invested $500 million in Rivian, with plans to use the electric vehicle maker’s platform to build a new Ford-branded electric vehicle, but the companies scrapped those plans in 2021. read more

Ford, which reports fourth-quarter results Feb. 3, also said Tuesday it would reclassify its $900 million non-cash gain in the first quarter of 2021 on the Rivian investment as a special item.

The reclassification will change the automaker’s adjusted earnings before interest and tax (EBIT) guidance for the full year, which was previously forecast between $10.5 billion and $11.5 billion, including the gain.

Ford also said it would record about $1.7 billion in costs associated with buying out and paying off more than $7.6 billion in high-cost debt in the fourth quarter.

It will also mark a non-cash gain of about $3.5 billion in the fourth quarter and $3.9 billion for the full year related to the revaluation of its global pension and other benefits after retirement.

Ford also said it would report a non-cash benefit of $3.6 billion, primarily due to changes in its global tax structure.

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Reporting by Aishwarya Nair in Bengaluru; Editing by Devika Syamnath

Our standards: The Thomson Reuters Trust Principles.

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