Ford Expects $0.6 Billion Pension Remeasurement Loss in Q4 2025
The company states: "Ford Motor Company uses the mark-to-market method of accounting for pension and other postretirement employee benefits. Under this method, we recognize pension and OPEB remeasurement gains and losses in income when incurred rather than amortizing them over time as a component of net periodic benefit cost. The remeasurement gains and losses are reported as special items since we believe they are not reflective of our ongoing operating activities. We expect to record a pre-tax remeasurement loss in our fourth quarter 2025 results of approximately $0.6 billion related to our pension and OPEB plans. This includes a $0.3 billion loss associated with pension plans in the United States, a $0.3 billion loss associated with pension plans outside the United States, and an immaterial impact for OPEB plans globally. The remeasurement loss for U.S. plans was largely driven by actuarial losses compared to plan assumptions. The remeasurement loss for non-U.S. plans was largely driven by changes in key plan measurement assumptions, such as improved life expectancy. On an after-tax basis, the remeasurement loss is expected to decrease our net income/(loss) by about $0.5 billion based on the tax impact in the jurisdictions where there are remeasurement gains and losses. Because the remeasurement is a special item, it will not affect our total Company adjusted EBIT or adjusted earnings per share. The remeasurement did not have an effect on our cash in 2025 and does not change our expectations for pension contributions in 2026. In aggregate, our funded plans remain fully funded. Including the impact of remeasurement losses during 2025, we expect the underfunded status for our pension and OPEB plans to be about $0.2 billion and $4.4 billion, respectively, at year-end 2025, compared with $0.5 billion and $4.4 billion, respectively, at year-end 2024."
