Ford's unexpected profit
How did Ford manage an $1 billion quarterly profit while other automakers struggle?
After refusing a bailout, Ford has returned to profitablitiy.
(Reuters/Corbis/Larry Downing)
Ford Motor Co. reported profits of nearly $1 billion in the third quarter, after piling up $30 billion in losses between 2006 and 2008. Ford even posted its first profitable quarter since 2005 in its struggling North America division -- after cutting costs by closing more than 10 plants and slashing 45 percent of its workforce in the region since 2005. Did declining federal bailout money help Ford win customers from GM and Chrysler?
Because capitalism works, and socialism doesn't: The secret to Ford's success is no mystery, says Don Surber in the Charleston, W.V., Daily Mail. Ford is the only Detroit automaker that turned down government aid and bankruptcy protection. The lesson here is that capitalism works; socialism doesn't.
"Ford posts billion-dollar profit"
Ford got plenty of government help: Ford did get a "nice boost from this summer's 'cash for clunkers' program," says Michael Fowlkes in Blogging Stocks. But the company couldn't have made that "surprising $1 billion profit" without all that cost cutting. And with Ford now saying it should be "solidly profitable" next year, its investors have "a reason to smile."
"Ford reports first North American profit in years"
Ford's luck could run out: Ford CEO Alan Mulally turned down government help, says Tom Walsh in the Detroit Free Press, saying, "We're happy where we are." Pounding "the drumbeat of difference" boosted the company's image, and its stock price. But now the United Auto Workers are refusing to give Ford cost concessions that Chrysler and GM got through Chapter 11. If Ford doesn't cut costs further, it will be at a competitive disadvantage.
"Ford's mantra of difference was taken to heart by its UAW workers"
Show: Oldest | Newest
8 Comments
Posted by Gut Shot, Monday, November 2, 2009, 3:18 pm Does anyone deserve to make over 70bucks an hour to screw plastic bumpers on mini vans while the Detroit policemen struggle to make a living while putting their lives on the line each day? thank the unions for most of the problems in Detroit today. When each person that touches a vehicle that is coming down the line makes 70 bucks an hour, how can you sell that vehicle for 15,ooo bucks? Big unions have Obama in their back pocket. Small business is what makes this country strong. Not big, greedy unions. Congratulations Ford.
Posted by Gut Shot, Monday, November 2, 2009, 3:25 pm American automakers brought this on themselves. Toyota and Nissan have been in this country for years. Did any of the big 3 notice that Toyota and Nissan were outselling them? Or, was it just that Detroit thought themselves untouchable? Their problems have been coming for years. They have only themselves to blame. I have no pity for them.
Posted by aaron, Monday, November 2, 2009, 3:36 pm Loving my 500 shares bought 1.91!
Posted by Greg, Monday, November 2, 2009, 4:18 pm Honda, Toyota and Nissan employ huge numbers of nonunionized workers in places like Tennessee. They demand performance and pay market wages which in practice afford their employees a good middle class standard of living.Detroit employs unionized employees, overpays them, gives them benfits that would make a mid level corporate executive at a software company drool and can't ditch deadbeats whose fathers and grandfathers worked for them.I wonder why our car company's are getting schooled?
Posted by GaryDL, Monday, November 2, 2009, 5:43 pm Could it be that Ford is actually building decent cars that Americans may actually want to buy? What a novel concept...!
Posted by CaliforniaGirl, Tuesday, November 3, 2009, 11:56 am Wake up America! Unions are going to kill us. We needed them when workers needed protection now they have the courts, OSHA, crazy juries, hungry lawyers. The unions are just bullies that vote left a voting constituency that can bring down a company, a business, an industry if they so choose. Wake up!
Posted by Brett, Wednesday, November 4, 2009, 3:12 pm Enough conservative whining about unions! Do you like working 40 hours a week for your salary, or do you want to work 75 hours a week for less pay? If you'd rather have 40 hours, vacation if you can take it, clean and safe working conditions, etc., then thank the unions. It was the CEOs and the members of the various boards who undermined the American auto industry by refusing to innovate and by refusing to increase quality and fuel efficiency. I agree that unions became part of the problem, too, but most of the blame lies squarely at top!
Posted by Brett, Thursday, November 5, 2009, 1:59 pm Also, don't be surprised if we find out that Ford has been playing tricks with their accounting to come up with these numbers. I'm not saying it happened, but given the track record of American corporations it wouldn't surprise me if it is all smoke and mirrors.
Post a Comment