The Wall Street Journal: CFOs of Ford, GM say demand still strong, but they’re watching for signs of recession


The chief financial officers for two of the U.S.’s largest car companies — General Motors Co.

 and Ford Motor Co.

— say consumer demand remains strong, but they are watching for signs of a U.S. recession.

At a Deutsche Bank conference Wednesday, Ford CFO John Lawler said an economic downturn is a possibility and that the auto maker was trying to assess the impact of inflation and rising gasoline prices on the broader economy. On Wednesday, the Federal Reserve approved a 0.75 percentage-point-rate increase, the largest since 1994.

Lawler said that higher commodity costs already are taking a toll on profitability in some areas.  Despite having increased the sticker price for the electric Mustang Mach-E, surging materials costs for EV batteries in recent months have wiped out the profit it had expected to make on the model, Lawler said.

Ford Credit, the company’s financing arm, is also seeing an uptick in delinquencies on auto loans, a signal of consumer health, he said. While the situation isn’t yet a significant concern — mostly because delinquency rates were low during the pandemic — Ford is monitoring it closely.

“We’re looking for every indication and every data point we can to get a read on where the consumer is, where they’re headed,” Lawler said.

GM’s CFO Paul Jacobson declined to say whether it also has raised prices on EVs, emphasizing that it wants to maintain flexibility in the future to account for fluctuating commodity costs. “We don’t want to end up in a situation where a customer has ordered a vehicle two, three years out, and we don’t know where inflation is going,” Jacobson said.

An expanded version of this report appears on

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