JULY 23, 2010, 11:38 A.M. ET.

Ford Profit Rises 13%

By JEFF BENNETT

DETROIT—Ford Motor Co. reported a 13% increase in second-quarter net income as the auto maker sold more vehicles at higher prices thanks to new models and consumer upgrades to high-tech features.

Ford has held the line on incentives and has offered such packages as its Sync in-car communications and entertainment system.

New Vehicle Slump Hurts GAP Sales. Access thousands of business sources not available on the free web. Learn More .The results provide further evidence that Chief Executive Alan Mulally's strategy to cut costs by reducing the number of cars and trucks available while offering more features is paying off. He has also dropped brands, freeing up more cash to invest in design and marketing. The auto maker confirmed in June it intends to end the Mercury brand by the end of the year, leaving it to focus on Ford and Lincoln.

For the quarter, earnings were $2.6 billion, or 61 cents a share, compared with $2.3 billion a year earlier. Excluding items, the company earned 68 cents a share, exceeding the 40-cent estimate based on a survey of analysts by Thomson Reuters.

Revenue rose 17% to $31.3 billion from $26.8 billion a year earlier.

Ford said the company's second-half financial results will be lower than the first half because of more costs associated with new-vehicle introductions. Ford said it is also positioned to report a positive automotive operating-related cash flow for 2010.

Write to Jeff Bennett at jeff.bennett@dowjones.com

http://online.wsj.com/article/SB1000142 ... 39378.html