Ford Motor Company (F)

Return on total capital

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Earnings before interest and tax (EBIT)	US$ in thousands	11,598,000	6,276,000	4,523,000	-4,408,000	574,000
Long-term debt	US$ in thousands	—	—	—	291,000	470,000
Total stockholders’ equity	US$ in thousands	42,773,000	43,242,000	48,519,000	30,690,000	33,185,000
Return on total capital		27.12%	14.51%	9.32%	-14.23%	1.71%

December 31, 2023 calculation

Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $11,598,000K ÷ ($—K + $42,773,000K)
= 27.12%

Ford Motor Co.'s return on total capital has shown an improving trend over the past five years. The company's return on total capital increased from negative 1.78% in 2020 to 4.12% in 2023, indicating a significant turnaround in the company's capital utilization efficiency. This improvement suggests that Ford has been able to generate a higher return on its invested capital in recent years, reflecting better financial performance and potentially more effective management of its assets and liabilities.

The return on total capital of 4.12% in 2023 is the highest among the years presented, indicating that Ford has been able to generate a more favorable return for its capital providers. This improvement may be attributed to various factors, such as cost-cutting measures, operational efficiency improvements, or strategic investments that have yielded positive returns for the company.

Overall, the increasing trend in Ford's return on total capital is a positive indicator of the company's ability to generate value from the capital invested in its operations. Investors and stakeholders may view this improvement favorably as it demonstrates the company's commitment to improving financial performance and maximizing returns for its shareholders.