Ford Motor Company (NYSE: F) posted third-quarter results that far surpassed expectations on the first trading day after tropical storm Sandy shuttered the markets on Monday and Tuesday.

Separately, this morning the company announced that its CEO, Alan Mulally, will be staying on in his current role until at least the end of 2014. Mulally has guided the company for the past six years, since he came over from Boeing (NYSE: BA).

Mark Fields, the head of Ford’s Americas division, was promoted to chief operating officer. Fields led the company’s North American business through its restructuring in the wake of the 2008/2009 financial crisis. North America is now Ford’s strongest market.

Ford Motor Company Is Riding a North American Auto Rebound

In the third quarter, Ford’s net income was essentially unchanged from a year ago, at $1.6 billion, or $0.41 a share. However, profits from continuing operations rose to $2.2 billion, or $0.40 a share, from $1.9 billion, or $0.34, topping the consensus forecast of $0.30.

The gain was largely the result of the company’s ongoing strength in North America. Ford Motor Company posted earnings of $2.3 billion on the continent in the quarter. That was up from $1.6 billion a year earlier and its biggest profit since it separated out the division’s results in 2000. Profit margins also jumped, to 12% from 8.6% a year ago.

The strong performance in North America offset a $468-million loss in Europe. Ford’s South American and Asian divisions posted small gains of $9 million and $45 million, respectively.

Revenue fell 3.0%, to $32.1 billion from $33.1 billion a year earlier. But that was still ahead of the consensus forecast of $31.5 billion. The positive results sent the stock up nearly 8% on the day.

Europe Is an Ongoing Trouble Spot for Carmakers—Including Ford Motor Company

In all, Ford expects to lose $1.5 billion in Europe this year. The company continues to try to cut those losses by restructuring its business on the continent: It recently announced that it is closing three plants—two in the U.K. and one in Belgium—in a move that will cut its workforce by 5,700 positions. That’s on top of a previously announced reduction of 500 managerial jobs.

Costs related to the restructuring will weigh on the company’s profits in the near term, but Ford expects the move to generate $450 million to $500 million in annual savings when the closures are complete. The company has also said that it expects to return to profitability in Europe by 2015.

Ford’s struggles in Europe are hardly unique to the company. All automakers are dealing with falling sales there due to the ongoing sovereign debt crisis. For example, General Motors (NYSE: GM), which also reported third-quarter results yesterday, lost $500 million on the continent during the quarter, as well, and also foresees a $1.5-billion loss there for the entire year. Europe accounted for 19% of Ford’s revenue in the latest quarter, compared to 14% for General Motors.

Ford’s Debt Is Under Control

One common concern among investors is that Ford is burdened by higher debt than its competitors. However, it’s important to look beyond the overall figure, as David Milstead of Canada’s Globe and Mail writes:

“The common perception is that Ford, which eschewed government bailouts in the financial crisis, has a balance sheet burdened by legacy liabilities. A quick glance at some investing websites, which list the company with $100-billion or so of debt, buttresses the view. But much of that debt is held by the company’s finance subsidiary, which is more bank than industrial giant, as it uses its borrowed money to make loans, creating an offsetting asset.”

Looking at the automotive business in isolation, Ford’s cash position continues to improve: It ended the quarter with cash of $24.1 billion, up $1.8 billion from a year ago. Its debt of $14.2 billion was flat from the previous quarter but up slightly from $12.7 billion from the third quarter of 2011.

In addition, Moody’s and Fitch recently returned the company’s debt rating to investment grade after seven years at junk status. That makes it easier for Ford to borrow money and lowers its interest payments.

New Car Models Look Competitive

The company continues to focus on introducing new models under its One Ford plan, which includes introducing 15 new vehicles around the world over the next five years, along with a number of new onboard technologies, particularly in the area of fuel efficiency.

For example, the 2013 Ford Taurus offers the company’s 2.0-liter EcoBoost engine, which delivers 240 horsepower while getting 31 miles per gallon on the highway. The engine can also go up to 10,000 miles without an oil change.

Takeaway for investors: Ford’s financial performance continues to improve, and its shares trade at just 7.8 times the company’s last 12 months of earnings. Also, unlike GM, Ford pays a dividend: The quarterly rate of $0.05 a share yields 1.79%. These advantages, along with its rejuvenated automobile lineup, give the stock a solid long-term outlook. But like GM, Ford will likely continue to be held back in the near term by the uncertain situation in Europe.

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