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Ford May Report Worst Loss in History
ap ^ | 1/24/07 | Tom Krisher, AP Business Writer

Posted on 01/24/2007 5:37:16 PM PST by Flavius

DETROIT (AP) -- Ford Motor Co. could post the worst annual loss in its storied 103-year history when the automaker releases its 2006 earnings on Thursday.

The old record net loss was $7.39 billion in 1992, but through three quarters of this year, Ford already had lost $7 billion.

Fourteen analysts polled by Thomson Financial expect more red ink in the fourth quarter, predicting an average quarterly loss of $1.01 per share and $1.35 per share for the year, excluding special items.

"The fourth quarter's going to look real ugly," said Erich Merkle, director of forecasting for the auto consulting company IRN Inc. in Grand Rapids, Mich. He predicted Ford would get as much bad news out of the way as it can for the end of 2006, beating the 1992 record.

"Let's just air all our dirty laundry all at once. Take the medicine and then we can move on. I definitely think that's their philosophy, knowing it's going to be real poor," Merkle said.

Burnham Securities analyst David Healy said in a note to investors that Ford has yet to recover from its finances being wrecked by collapsing sales of its F-series pickup trucks and truck-based sport utility vehicles.

The company made a profit of $1.44 billion in 2005, and in the fourth quarter of that year, it produced and shipped 355,000 of the high-profit large and mid-sized truck models, Healy said. That dropped by 40 percent to 213,000 in the final quarter of last year, he said.

"In our view, most of the year-to-year increase in losses lies in the 142,000 year-to-year decline in these high-profit models," Healy said.

Production of other Ford models dropped by 53,000 in the fourth quarter of last year compared to the last quarter of 2005, driven by dealer stock reductions and the company's strategy to reduce traditional low-profit sales to rental car companies, Healy said.

Efraim Levy, senior industry analyst for Standard & Poor's, predicted Ford would post a $2 billion net loss for the last quarter of 2006.

Like other analysts, he sees bottom-line improvement in 2007 even though he predicts revenues will drop by 7 percent compared to 2006. He still sees a loss for this year, but said the improvement will come as Ford becomes more efficient and cuts costs by slicing its blue- and white-collar work forces.

About 38,000 hourly workers have signed up for buyout or early retirement offers from the company, and Ford plans to cut its white-collar work force by 14,000 with buyouts and early retirements.

The company has mortgaged its assets to borrow up to $23.4 billion to fund a massive restructuring plan and cover billions in losses expected until 2009. It expects to burn up $17 billion in cash during the next two years before returning to profitability.

Ford's revenue will continue to suffer in 2007 from intense competition, an expected lower overall auto market and weakness in Ford's financial services business, Levy said.

Ford has rolled out or will introduce several new or updated products during 2007, including the Edge crossover, new F-series Super Duty pickups, a redesigned Focus small car and an updated Five Hundred larger sedan.

But Levy said the company's new vehicles won't be strong enough for it to recover much this year.

"The new products aren't that exciting overall," he said.

Ford's sales last year were 8 percent below 2005 figures at about 2.9 million vehicles. Ford attributed the decline to a drop in truck and sport utility vehicle sales and the end of production for the Taurus sedan, which largely was sold to fleet buyers last year.

Ford is the first of the Detroit-area automakers to release its earnings for the year. General Motors Corp., which lost more than $3 billion in the first nine months of last year, will release its fourth-quarter and annual earnings on Tuesday.

DaimlerChrysler AG, which lost $1.5 billion in the third quarter, is to release its earnings on Feb. 14.

Ford Motor Co.: http://www.ford.com


TOPICS: News/Current Events
KEYWORDS: automotive; cars; globalism; trade
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Well, most cars today, any brand is a pile of plastic, and cheap electronics and hideous design. Obviously my opinion.

So since #1 car manufacturer Toyota also builds hideous, bubbly cars,in my opinion, one can assume the only loyalty is in years of reliable service or perception of that track record.

Since parts are virtually from same suppliers for all car manufacturers, then it can be the no hassle repair/quality customer service that builds brand loyalty.

Lastly, for foreign cars there are no union dues on a car, which I guess is $1500 premium per USA vehicle.

1 posted on 01/24/2007 5:37:17 PM PST by Flavius
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To: Flavius

UNION workers and pension plans.


2 posted on 01/24/2007 5:39:07 PM PST by onyx (DEFEAT Hillary Clinton, Marxist, student of Saul Alinsky & ally and beneficiary of Soros.)
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To: Flavius

Ford of Michigan or Ford of Tennesse? :)


3 posted on 01/24/2007 5:41:00 PM PST by NonValueAdded (Pelosi, the call was for Comity, not Comedy. But thanks for the laughs. StarKisses, NVA.)
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To: Flavius; onyx

Sounds like they're not feeling very GAY over at Ford.


4 posted on 01/24/2007 5:41:35 PM PST by Enterprise (Drop pork bombs on the Islamofascist wankers. Praise the Lord and pass the hammunition.)
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To: Flavius

and for this they were paying $900,000 per year for Mark Fields to commute to Miami on weekends?
http://money.cnn.com/2007/01/18/news/companies/fields_flights/?postversion=2007011814


5 posted on 01/24/2007 5:42:02 PM PST by nascarnation
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To: Flavius
Not sure if it means much, but this weekend's auto show in central MA doesn't even show Ford on the floor plan!

Although there are Ford brands- Jag and Land Rover.

www.worcesterautoshow.com

6 posted on 01/24/2007 5:42:54 PM PST by SteveMcKing
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To: Enterprise

well i was trying to focus on plastic on rubber wheels that passes for "trucks" these days


7 posted on 01/24/2007 5:43:33 PM PST by Flavius (Qui desiderat pacem, praeparet bellum)
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To: Flavius

You also pay somewhat more than $500 per vehicle for the insurance premium that the manufacturer has to carry in the USA.

Ford will collapse. Someone else will buy the plant up and continue producing cars... this time without having to support the ridiculous union compensation levels and after firing all the managers that brought the company to this pass. The govt will end up carrying the weight of the ridiculous pensions.


8 posted on 01/24/2007 5:44:21 PM PST by Seruzawa (Marx's Das Kapital never could compete with the Sears catalog.)
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To: Flavius

Until ford can bulid a full size pick up worth a dam i will keep buying toyotas every ten years and worry only about gas tires and oil


9 posted on 01/24/2007 5:45:06 PM PST by al baby (Hi mom)
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To: SteveMcKing

the jag looks like ford Taurus with 20 cent more expensive head lights

i just cannot believe that in a country as creative as United States

the car industry relies on old ceo's old accountants to make designs decisions

its really a crime, i know there are probably thousand of talented kids that are not allowed to create

that part is management fault as well,

off course all in my opinion


10 posted on 01/24/2007 5:45:41 PM PST by Flavius (Qui desiderat pacem, praeparet bellum)
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To: Seruzawa

The govt will end up carrying the weight of the ridiculous pensions.= You and me


11 posted on 01/24/2007 5:46:01 PM PST by al baby (Hi mom)
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To: al baby

I figured that the brighter people here would understand that without having to explain it. Thanks for helping the others out.


12 posted on 01/24/2007 5:47:55 PM PST by Seruzawa (Marx's Das Kapital never could compete with the Sears catalog.)
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To: Seruzawa

Ford will survive. No Ford fan I, but the family still has enough money and borrowing power to survive as a smaller maker. Why Mercury ? Why this stupid pig they're trying to pass off as a Lincoln SUV ? Gad.


13 posted on 01/24/2007 5:48:17 PM PST by Eric in the Ozarks (BTUs are my Beat.)
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To: Flavius

Well, Ford is still better than the NY Times.


14 posted on 01/24/2007 5:49:46 PM PST by jdm
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To: Flavius

Boeing turned it around, so can GM and Ford.


15 posted on 01/24/2007 5:50:25 PM PST by LdSentinal
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To: jdm

ahm well yes shredded paper absorbs much more then shredded car


16 posted on 01/24/2007 5:52:58 PM PST by Flavius (Qui desiderat pacem, praeparet bellum)
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To: Flavius
...car manufacturer Toyota also builds hideous, bubbly cars...

Chrysler's second nearest bankruptcy came as a result of their designs in the late forties/early fifties. They did extensive surveys about what customers wanted. Looks was far down the list. Chrysler designed the boxy cars that people said they wanted and got laughed at for their efforts.

Maybe Toyota just builds cars that people will buy. Seems to work for them. Buyers like to think about "style" and performance but many buy on price and reliability.

17 posted on 01/24/2007 5:53:19 PM PST by FreePaul
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To: al baby

Per news reports also out today, the UAW is in negotiations for the union to assume retiree health benefits, which could potentially save $1000+ per vehicle.

We'll see if it happens, but if it does, it would almost guarantee to save the companies and the taxpayers $$$, as the savings could be greater than the per vehicle losses the companies are currently seeing.


18 posted on 01/24/2007 5:54:01 PM PST by eraser2005
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To: Flavius
So spending all that time, effort and money catering to the gay community is really paying off for them?

I guess putting all that time and energy into engineering a reliable, attractive, affordable product didn't seem necessary.

And then there's the unions.

19 posted on 01/24/2007 5:54:09 PM PST by AFreeBird (If American "cowboy diplomacy" did not exist, it would be necessary to invent it.)
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To: Seruzawa

Well it was for the trolls and and lurkers from du and for Sean Hannity he he he


20 posted on 01/24/2007 5:54:20 PM PST by al baby (Hi mom)
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To: FreePaul
Reliability is everything. I'll bet the #1 or #2 reason for every Toyota, Honda, Nissan sale is that they last.
21 posted on 01/24/2007 5:57:05 PM PST by Eric in the Ozarks (BTUs are my Beat.)
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To: LdSentinal

GM is already on the road to recovery with some great products in the pipeline for this year: New Cadillac CTS, Buick Enclave, Chevy Malibu, Saturn Aura, Saturn Outlook, Pontiac Solstice, Saturn Sky, GMT-900s, etc... All of which are segment leading or are close to it. I really should have bought a bunch of their stock when it was in the crapper. I knew this would happen too!

Ford needs some work, but with Bill Jr. gone now and the Boeing CEO taking control they may have a future yet. My friend got a new Ford Fusion and it is a very nice car, especially for the $$$.

And internationally GM has done phenomenally btw. Even Ford outside of NA does pretty darn good. It is the darn Unions that will get them.


22 posted on 01/24/2007 5:57:21 PM PST by rom
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To: FreePaul

thats exactly what i said

i said people buy cars that don't break

if you ask an average person which car they know if that does not break up

it will be toyota

thats why they are #1


23 posted on 01/24/2007 5:57:49 PM PST by Flavius (Qui desiderat pacem, praeparet bellum)
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To: Flavius

Even Edsel didn't screw it up this bad!


24 posted on 01/24/2007 5:57:59 PM PST by Don Corleone (Leave the gun..take the cannoli)
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To: al baby

25 posted on 01/24/2007 5:58:22 PM PST by Rb ver. 2.0 (A Muslim soldier can never be loyal to a non-Muslim commander.)
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To: Flavius

My 2002 Ford Mustang is awesome. I've been very happy with Fords.


26 posted on 01/24/2007 5:59:56 PM PST by mysterio
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To: Enterprise
Image hosted by Photobucket.com i don't know, looks like they took one in the...

27 posted on 01/24/2007 6:01:59 PM PST by Chode (American Hedonist )
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To: al baby

Ford will eventually be reduced to a truck division and nothing more. Perhaps the Ford family will take it private or perhaps merge with another auto company. Being that GM, Chrysler/Diemler, and Toyota already have their own strong truck divisions, these would be ruled out. Perhaps Renault or Nissan?

I heard a comment on CNBC the other day; a talking head stated that the Big Three are very inefficient and thereby does everything very slowly, they can't even go bankrupt in a hurry....


28 posted on 01/24/2007 6:02:25 PM PST by snoringbear
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To: Flavius

Wow. I hope they can make it.


29 posted on 01/24/2007 6:03:49 PM PST by Uncle Hal
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To: snoringbear

AFA has a nice boycott going on Ford. But, liberals at Ford are too dumb to see they are going over the gay cliff.


30 posted on 01/24/2007 6:04:30 PM PST by Goreknowshowtocheat
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To: al baby

"Until ford can bulid a full size pick up worth a dam i will keep buying toyotas every ten years and worry only about gas tires and oil"

You can't be serious. Ford has the best selling pickup truck in America for 30 years. Why they can't be profitable with their truck line and the legendary Mustang is beyond me.


31 posted on 01/24/2007 6:05:56 PM PST by 38special (I mean come'on.)
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To: Chode

LOL - I tracked the picture back via the properties.


32 posted on 01/24/2007 6:07:22 PM PST by Enterprise (Drop pork bombs on the Islamofascist wankers. Praise the Lord and pass the hammunition.)
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To: Flavius

It is only a matter of time before Toyota, Honda, and Nissan design and market a pickup that farmers, hunters, and contractors in Indiana, Iowa, and Georgia will buy. When they start replacing their F-150's, Silveradoes, and Rams with imports, the Big Three will have nothing left to stand on. Pickup sales are all they really have left.


33 posted on 01/24/2007 6:10:57 PM PST by ForOurFuture
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To: Flavius
Cars are much better and reliable than they used to be, for the most part. However, this is the...worst...commercial...ever.

I cannot believe they're selling that ugly little anonymous car as being"sexy" or "edgy."

34 posted on 01/24/2007 6:23:26 PM PST by Richard Kimball
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To: Richard Kimball

cross over is that like almost a guy


35 posted on 01/24/2007 6:28:04 PM PST by Flavius (Qui desiderat pacem, praeparet bellum)
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To: Richard Kimball

The only thing new about "crossovers" is the term itself. These are purely minivans and station wagons they are selling.


36 posted on 01/24/2007 6:31:15 PM PST by SteveMcKing
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To: Flavius
My Warm And Fuzzy Feelings For Ford- by Fatcity

I worked for Ford- Engine Plant #1 in Cleveland- for a year, before I volunteered for the draft in 1969. Ran a piston rod grinder and had to grind 9,000 rods a night. When I'd run 5,000, each night, the foreman would come over and adjust the counter to 9,000 and send me up to the cafeteria to play gin for 3 hours. The other 4,000 were known as "paper rods". Being a dumb kid, one day I asked the foreman why we were making "paper rods". He looked at me with hillbilly incredulousness and said, "because they're making piston heads over on the head line"!

The military came as a breath of fresh air.

37 posted on 01/24/2007 6:36:41 PM PST by fat city (What part of cognitive dissonance don't you understand?)
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To: SteveMcKing

well every car mechanic/salesperson i talk to toyota or mercedes for example

talk of endless parade of sensitive people whining about the road noise and tire noise on their trucks

and all the girls wanted a truck with a car like performance

so what are the poor manufactures to do but to build these minivans with 4 wheel drive capability

at end they have to sell what people want and like much else its a softy cars/truck lookalikes they are after


38 posted on 01/24/2007 6:38:12 PM PST by Flavius (Qui desiderat pacem, praeparet bellum)
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To: onyx

Look for the Union Label.


39 posted on 01/24/2007 6:38:48 PM PST by A CA Guy (God Bless America, God bless and keep safe our fighting men and women.)
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To: mysterio

I just bought a 2007 Ford Focus 4dr Hatchback. Great handling, cruises at 80 and with less than 3,000 miles, I am getting 30+mpg. Yes, the inside is plastic, but what did I pay for? An economical, good riding car. And guess what I got? An economical and good riding car.


40 posted on 01/24/2007 6:39:51 PM PST by Prost1 (Fair and Unbiased as always!)
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To: Flavius
Buy Ford at $8.20 and prosper. Mullaly is turning around Ford quicker than most people thought. The next couple of years will be tough, but the map has been made, and it is being executed. One thing you can always count on is: When Americans get shoved into a corner, they come out fighting. Ford is America...
41 posted on 01/24/2007 6:40:46 PM PST by devane617 (It's McCain and a Rat -- Now what?)
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To: SteveMcKing

Crossovers = MMV ( MetroSexual Mini Vans)


42 posted on 01/24/2007 6:42:12 PM PST by devane617 (It's McCain and a Rat -- Now what?)
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To: onyx

I have an F-250 Super Duty 4WD that got so big you will blush just by sitting next to me:):) It also makes bigger noises than you can. Would you like to get worked up and have a little fun?:):)


43 posted on 01/24/2007 6:44:30 PM PST by BobS
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To: ForOurFuture
It is only a matter of time before Toyota, Honda, and Nissan design and market a pickup that farmers, hunters, and contractors in Indiana, Iowa, and Georgia will buy.

The image “http://www.womanmotorist.com/images/articles/reviews/toyota/2007ToyotaTundraCrewMax01.jpg” cannot be displayed, because it contains errors.

That time may soon be at hand. 

44 posted on 01/24/2007 6:46:55 PM PST by martin_fierro (< |:)~)
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To: onyx

"UNION workers and pension plans."

True but it goes much deeper than that. Ford drove away generations of loyal customers by putting out cars that didn't drive as well and were less reliable than the Japanese. Now those costumers are loyal to brands like Honda and Toyota. In order to win them back, Ford has to put out cars in mainstream segments that aren't just as good as Hondas and Toyota but better. They haven't done that. The Mustang is nice but it isn't exactly in a real high volume segment and cars like the new 500 are real yawners.

What has kept Ford afloat lately has been SUV sales. Those are falling off too as Japanese companies put out cars in that segment that are much more innovative and drive better than the stodgy Ford Explorer and Expedition and as some shoppers are getting tired of the fuel bills associated with the vehicles and switching segments.


45 posted on 01/24/2007 6:51:25 PM PST by SmoothTalker
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To: al baby
Not necessarily - the PGBC can simply default. Right now - under current law there is no full faith and credit guarantee of the pension plans assumed by the PBGC. But you can bet it will come up in a Democratic Congress.
46 posted on 01/24/2007 7:05:13 PM PST by Wally_Kalbacken
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To: Flavius
the car industry relies on old ceo's old accountants to make designs decisions

Just my naive guess...
but I wouldn't be suprised if it is really a combination of
old ceos and younger (under 50) accountants/MBAs.

I'm not totally sure of the age brackets...but that seemed to be
the combination that brought down Enron. (Ken Lay as the older CEO,
and the "innovative" younger underlings working like speed-junky termites)
47 posted on 01/24/2007 7:07:01 PM PST by VOA
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To: NonValueAdded

I thought Ford died last month ?


48 posted on 01/24/2007 7:14:12 PM PST by festus (The constitution may be flawed but its a whole lot better than what we have now.)
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To: LdSentinal

Ford maybe. I have my doubts about GM. But Ford is going to have to sell some stuff off and go back to what made them big in the first place. Building high quality cars that the average family can afford.


49 posted on 01/24/2007 7:19:06 PM PST by Harmless Teddy Bear (We must have faith For when it is all said and done, Faith manages. And the impossible is achieved)
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To: FreePaul
Chrysler's second nearest bankruptcy .....

LOL. Sounds like some relatives I have..........
50 posted on 01/24/2007 7:20:37 PM PST by festus (The constitution may be flawed but its a whole lot better than what we have now.)
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