Commodity prices continued to be a headwind for Ford Motor, CEO Jim Farley told CNBC’s Jim Cramer on Wednesday, but the company has managed to offset them through its pricing strategy.
“The pressure of goods, the premium cargo that we’re seeing, I mean it’s really real. … The good thing is that our pricing has balanced all of that. I think we’re underpaid as a company, so we have more expenses to do this year, next year, next few years,” Farley said in an interview with Mad Money.
Some of the commodities where Ford has seen higher costs include steel, aluminum, nickel, cobalt and lithium, Farley said.
“We had some really bad commodities that held back our most profitable units, and we think that’s an area where we’re bullish in the second quarter and second half,” he added.
Farley’s comments come as Wall Street fears higher costs and supply chain problems will weigh on General Motors and Ford’s profits this year.
The chief executive also said that the company is planning further pricing actions, particularly on its electric vehicles. Farley told CNBC on Tuesday that he believes the company will be able to produce 150,000 F-150 Lightning EVs within the next year, even given the supply chain issues.
Ford on Wednesday reported better-than-expected first-quarter revenue and earnings. Ford’s shares were up about 1% after the close of business.
Disclosure: Cramer’s Charitable Trust owns shares in Ford.
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