Car giant Ford has said that its earnings in 2017 will take a $600m hit due to the currency effects related to the UK’s decision to leave the European Union.
The automaker earned $1.2bn in Europe in 2016 following several years of work on a turnaround plan.
Ford Europe chief Jim Farley told Reuters that the company will no longer benefit from currency hedges that had been shielding it from the pound’s slump since the referendum taken last June.
Farley said: “When Brexit happened we were fully hedged for the first quarter with the stronger pre-Brexit exchange rate.
“As we enter the rest of the year, especially the second half, we now face the full effects of the weaker sterling.”
Ford has two factories in the UK, which manufactures engines for its vehicles produced in other European countries.
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The company, which employs 14,000 people in Britain, imports lots of vehicles manufactured in other European countries and across the world to the UK for sale.
Ford is the country’s largest-selling vehicle brand, with about 12% of the market share.
The company is transitioning from an automotive company to an auto and mobility company through its Ford Smart Mobility programme.
Ford is planning to deliver a fully autonomous vehicle made for the mass market by 2021, with the car specifically designed for ride sharing.
In order to meet its 2021 target, Ford said it will be investing in or collaborating with four start-ups to enhance the autonomous vehicle development.
