RedlightG20 Posted November 2, 2009 Share Posted November 2, 2009 Ford surprises with $1B profit; sees profit in '11 http://news.yahoo.com/s/ap/20091102/ap_on_bi_ge/us_earns_ford AP - DEARBORN, Mich. – Ford, the only Detroit automaker to dodge direct government aid and bankruptcy court, surprised investors with net income of nearly $1 billion in the third quarter and forecast a "solidly profitable" 2011. The automaker said Monday earnings were fueled by U.S. market share gains, cost cuts and the Cash for Clunkers program, which drew flocks of buyers to showrooms this summer. Ford's shares rose 58 cents, or 8.3 percent, to $7.58 in pre-market trading. The latest results signal that Ford's turnaround is on more solid ground. The company lost more than $14.6 billion last year and hasn't posted a full-year profit since 2005. While it made a profit in the second quarter, that was mainly due to debt reductions that cut its interest payments. Dearborn, Mich.-based Ford reported third-quarter net income of $997 million, or 29 cents per share. Ford also forecast a "solidly profitable" 2011. Previously the automaker said it would be break-even or better. Its key North American car and truck division posted a pretax profit of $357 million, the company's first quarter in the black since early 2005. Ford cited higher pricing, lower material costs and increased market share for the improvement. Excluding one-time items, Ford earned 26 cents per share, blowing away analysts' expectations of a loss of 12 cents. The earnings came despite an $800 million revenue drop. But Ford said it cut costs by $1 billion during the quarter, accomplished through layoffs in North America and Europe, reduced pension and retiree health care costs and improvements in productivity and product development. Chief financial officer Lewis Booth said the company took in $1.3 billion more than it spent in the quarter, an improvement over its $1 billion cash burn in the second quarter. "That's a huge deal," Booth said. Ford's plan to create demand and get better prices for its products, coupled with cost cuts, gave the company confidence that it will make money in 2011, Booth said. Link to comment Share on other sites More sharing options...
DCsportsfan53 Posted November 2, 2009 Share Posted November 2, 2009 Should've just let Chrysler and GM fold instead of rewarding them for their incompetence. If it was just economic factors that they all faced, how did Ford come out without taking a dime of gov't money? I know if I was going to buy an American car Ford would be the only one on my list. Link to comment Share on other sites More sharing options...
Spaceman Spiff Posted November 2, 2009 Share Posted November 2, 2009 Well done, Ford. Link to comment Share on other sites More sharing options...
FanboyOf91 Posted November 2, 2009 Share Posted November 2, 2009 Should've just let Chrysler and GM fold instead of rewarding them for their incompetence. If it was just economic factors that they all faced, how did Ford come out without taking a dime of gov't money? I know if I was going to buy an American car Ford would be the only one on my list. Ford borrowed a ****load of money before the credit crunch. The other area where Ford has a cost disadvantage is debt. Ford reported $26.9 billion in debt, up $800 million from the second quarter. The company avoided the same fate as rivals Chrysler and GM by mortgaging its factories and even the familiar blue oval logo to borrow $23.5 billion before credit markets froze last year. Consumers also like the fact that it wasn't bailed out.Ford also has benefited from consumer goodwill after it declined government bailout money and didn't go into bankruptcy over the summer as GM and Chrysler did. Ford grabbed sales from its rivals, posting the largest increase in market share of any automaker in September. Ford expects an overall gain in U.S. market share in 2009, a feat it hasn't accomplished since 1995. Link to comment Share on other sites More sharing options...
SnyderShrugged Posted November 2, 2009 Share Posted November 2, 2009 how long until ford's execs are investigated for earning too much? Link to comment Share on other sites More sharing options...
twa Posted November 2, 2009 Share Posted November 2, 2009 :cool2: somebody has got to pay some taxes sadly the Canadians and South Americans probably benefit more than the US;) Link to comment Share on other sites More sharing options...
SkinInsite Posted November 2, 2009 Share Posted November 2, 2009 I wonder how much of that profit is due to worker layoffs or increased efficiency. My Econ prof told me the first thing execs can do to increase profit and look good to investors is massive layoffs. You earn less but still make money. Link to comment Share on other sites More sharing options...
Thiebear Posted November 2, 2009 Share Posted November 2, 2009 I wonder how much of that profit is due to worker layoffs or increased efficiency.My Econ prof told me the first thing execs can do to increase profit and look good to investors is massive layoffs. You earn less but still make money. Its in the paragraph, Econ Prof should have taught you to read Link to comment Share on other sites More sharing options...
Brad_Edwards_Fan Posted November 2, 2009 Share Posted November 2, 2009 The earnings came despite an $800 million revenue drop. But Ford said it cut costs by $1 billion during the quarter, accomplished through layoffs in North America and Europe, reduced pension and retiree health care costs and improvements in productivity and product development. Looks like a huge chunk was from layoffs/cuts and efficiency gains Link to comment Share on other sites More sharing options...
SkinInsite Posted November 2, 2009 Share Posted November 2, 2009 Its in the paragraph, Econ Prof should have taught you to read It didn't say how much they saved just by laying off workers. If they save 800 million just through cutting workers than I would say ford didn't do as well as they want people to think. Link to comment Share on other sites More sharing options...
SnyderShrugged Posted November 2, 2009 Share Posted November 2, 2009 Looks like a huge chunk was from layoffs/cuts and efficiency gains This is as it should be. A leaner organization that has a focus on cutting waste is a good thing. Link to comment Share on other sites More sharing options...
deejaydana Posted November 2, 2009 Share Posted November 2, 2009 I still admire them for turning down the last round of gov't handout money. Hopefully they can build upon this (and I don't think anyone's mentioned how cash for clunkers played a part in these numbers). Link to comment Share on other sites More sharing options...
Brad_Edwards_Fan Posted November 2, 2009 Share Posted November 2, 2009 This is as it should be. A leaner organization that has a focus on cutting waste is a good thing. Agree, so long as the cuts dont damage long term potential. Link to comment Share on other sites More sharing options...
SnyderShrugged Posted November 2, 2009 Share Posted November 2, 2009 I still admire them for turning down the last round of gov't handout money. Hopefully they can build upon this (and I don't think anyone's mentioned how cash for clunkers played a part in these numbers). clunkers definitely helped them temporarily. Also the loan from the treasury helped too. Link to comment Share on other sites More sharing options...
SnyderShrugged Posted November 2, 2009 Share Posted November 2, 2009 Agree, so long as the cuts dont damage long term potential. definitely agree (and I think cuts via attrition works better than large scale layoffs) Though, I'm biased some. I worked for Ford for 10 years as a quality consultant. Link to comment Share on other sites More sharing options...
big#44 Posted November 2, 2009 Share Posted November 2, 2009 http://jalopnik.com/5395082/ford-posts-997-million-profit-still-down-13-billion-this-year/gallery/?skyline=true&s=x Link to comment Share on other sites More sharing options...
RedlightG20 Posted November 2, 2009 Author Share Posted November 2, 2009 As far as American cars goes, Ford was always my favorite. I'm really glad to see that they are building cars that people want. It's still too soon how their new vehicle lineup has affected any increase in profit, but their newest cars are extremely attractive. GM is coming around, but Chrysler still looks like they're putting out the same old crap. Link to comment Share on other sites More sharing options...
Koolblue13 Posted November 2, 2009 Share Posted November 2, 2009 Ford has been on the opposite side of the Federal government for over 100 years. No bail out money and turning a profit. O'l Henry is smiling in his grave. And I love my F-150. Link to comment Share on other sites More sharing options...
Larry Posted November 2, 2009 Share Posted November 2, 2009 1) I'd call this good news. IMO, a big American company (and a manufacturing company, at that) making a profit, no matter how they did it, is Good News. 2) I'll confess, I've always liked Ford cars, too. Right now, I've got an F-150 and an Explorer in the driveway. And I've always thought the Pinto (first car I drove) was a very good car for it's target. 3) I also have to admit, I've liked the advertising I've seen for the new engine they're producing. There's something to be said for being able to say "More Horsepower and better gas mileage". And I think they're putting it in the right vehicles to start with. (Although in terms of new technology, I wouldn't mind seeing the Chevy Volt catch on, either. Wouldn't mind seeing the government subsidize it for a few years. IMO, any technology that has the potential to get us off of oil is a National Security issue.) Link to comment Share on other sites More sharing options...
big#44 Posted November 2, 2009 Share Posted November 2, 2009 3) I also have to admit, I've liked the advertising I've seen for the new engine they're producing. There's something to be said for being able to say "More Horsepower and better gas mileage". And I think they're putting it in the right vehicles to start with. the ford taurus sho is the first ford that has looked appealing to me in a long time. Link to comment Share on other sites More sharing options...
SnyderShrugged Posted November 2, 2009 Share Posted November 2, 2009 They really missed the deign boat in the late 90's and early 2000's. I think they are finally getting it together in new models and choices now. The f150 will always be one of the top trucks (IMHO) Ford devoted a ton of R & D to it's design and continuous improvement. Link to comment Share on other sites More sharing options...
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