DETROIT – Ford Motor will reinstate its regular dividend starting in the fourth quarter, more than a year and a half after suspending the payments during the early days of the coronavirus pandemic.
The fourth-quarter dividend of 10 cents per share on outstanding common and Class B stock will be paid on Dec. 1 to shareholders at the close of business on Nov. 19, the company announced Wednesday when it released its third-quarter earnings that beat Wall Street’s expectations.
Ford shares jumped by about 5% during after-hours trading. The stock closed Wednesday down by 2.7% to $15.51 a share.
“The strength of the business gives us the confidence to reinstate the dividend at this point,” CFO John Lawler told reporters Wednesday during a call.
Lawler said the company is not capital constrained and is confident it can finance an aggressive turnaround plan called Ford+, which includes investing billions in electric and autonomous vehicles, as well as the dividend
The quarterly cost of the dividend will be about $400 million, according to Lawler.
Ford was quick to cut the dividend to shore-up cash as the coronavirus pandemic caused the automaker to shutter plants and dealerships last year to stop the spread of Covid-19.
General Motors, which cut its dividend a month after Ford, has not reinstated its dividend.