Lower Profits Expected From Ford

Automaker Ford

is expected to see profits fall for the second quarter compared to last year when it reports earnings this week. According to the

, Ford's earnings per share are expected to fall roughly 43 percent to about $0.28 from $0.49 in 2011.

on May 23 that Ford's credit rating had been raised from Ba2 to Baa3 by Moody's, the second ratings agency to restore the Detroit car maker's investment grade rating, meaning that Ford's seven-year period of paying higher junk bond interest rates is over. That meant that Ford could reclaim its blue oval logo, as well as billions of dollars' worth of other assets that it pledged as collateral on $23.4 billion in loans that it borrows back in 2006. "We knew we could get this done," CEO Alan Mulally told reporters. "This is a very exciting day for everybody associated with Ford, our employees, our dealers, our suppliers. It's way up there on the highlight film for sure." However, last week the company announced that it will be reducing labor costs in Canada. An anonymous Ford source said that, "We're really looking at this round of negotiations as an opportunity to improve the competitiveness of the Canadian operations. Canada has higher labor costs than anywhere else we do business. It's not sustainable." It has been a mixed 12 months for Ford then, and when the earnings come out this week revenue is expected to have dropped four percent to roughly $32.2 billion, compared to $33.5 billion in 2011. As with many companies at present, the economic climate in Europe is severely hurting Ford with the company expected to report pretax losses of $400 million across the Atlantic. Only last year, Ford made profits of $180 million in Europe. Ford is also expected to report losses of $90 million in South America, compared to profits of $270 million last year. On Tuesday, Ford traded at about $9, down roughly 1.5 percent.