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Discussion Starter · #1 ·
From the Associated Press, as published by the NYTimes:
http://www.nytimes.com/aponline/bus...&en=39c5efd783c59085&ei=5094&partner=homepage

By THE ASSOCIATED PRESS
Published: January 25, 2007

Filed at 8:08 a.m. ET

DEARBORN, Mich. (AP) -- Ford Motor Co. lost $5.8 billion in the fourth quarter amid slumping sales and huge restructuring costs, pushing the fabled automaker's deficit for the year to $12.7 billion, the largest in its 103-year history.

The annual loss of $6.79 per share reported Thursday surpassed its previous record for a year of $7.39 billion set in 1992. It earned $1.44 billion, or 77 cents a share, in 2005.

The Dearborn-based company expects more losses for this year. It expects to burn up $10 billion in cash on automotive operations through 2009 and spend another $7 billion to invest in new products.

The fourth-quarter loss was the worst final-quarter loss in Ford's history and its second-worst quarterly performance. Ford lost $6.7 billion in the first quarter of 1992, due mainly to accounting rule changes on health care liabilities.

''We began aggressive actions in 2006 to restructure our automotive business so we can operate profitably at lower volumes with a product mix that better reflects consumer demand for smaller, more fuel-efficient vehicles,'' Alan Mulally, president and chief executive officer, said in a statement. ''We fully recognize our business reality and are dealing with it. We have a plan and are on track to deliver.''

Excluding special items, Ford lost $1.50 per share in all of 2006, worse than Wall Street predicted. Fourteen analysts polled by Thomson Financial expected a loss of $1.35 per share for the year, excluding special items.

Its shares fell 10 cents to $8.10 in premarket trading.

Ford said that special items associated with restructuring costs totaled $9.9 billion for the year as the company continues efforts to shrink itself to match reduced demand for its cars and trucks.

Sales for the fourth-quarter fell to $40.3 billion from $46.3 billion a year ago, while annual sales dropped to $160.1 billion from $176.9 billion in 2005.

I'll tell you one thing - I have trouble even grasping that number. There's just nothing in life that you can relate to (unless you're Bill Gates ;) ) that could make you appreciate those numbers...
 

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Horrible news. As you said, Zoom, it is unfathomable, almost impossible to comprehend. Alan Mulally has his work cut out for him, and then some. Boz
 

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You have to TRY to lose that much money! Fords product line up and the product itself is absolutely horrible. My parents are buying a car in the next 2 months and for the first time since I can remember, it's not going to be a Ford. Even they, who know NOTHING about cars think Ford's feel cheap. After all the bullshit I've been through with my Fusion, I won't be buying a car when I buy another one in the fall.

Focus- Outdated, cheap interior
Fusion- One bright spot, but after dealer experiences, I will not buy another.
Five Hundred- Decent car but makes Toyota's look sporty.
Mustang- The fad is wearing off, horrible interior materials
Freestar- Outdated before it was even introduced
Freestyle- Is there even a need for this?
Edge- Not bad to look at but if I want a total plastic interior, I'll buy a Kia for $10k less.
Escape- Outdated, cheap, my parents Mariner is a noisy rattle box.
Explorer- Nobody is buying SUV's...and if I am, it's not going to be an Explorer
Expedition- What do you do with $3/gal gas, make a it bigger!!
Ranger- Was outdated 10 years ago
F series- Best truck made, but nobody is buying them to drive to the grocery store anymore.

I can't believe an entire company with highly educated, experienced management can F up so bad. For years I've read magazines and people on forums screaming to bring over their Euro line up. They're better built, better materials and better looking. Instead of doing that, they make our cars cheaper! What company gives the rest of the world better product and leaves its home market with garbage?? Lebonon, a TERRORIST STATE, has the C1 Focus!!!!! That's a slap in the face. I know so many people who want to buy Ford/GM/Dodge, but don't because their cars are garbage. In the end, people can only buy American so long before they get fed up and have to look out for their own well being.
 

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Since when did we not have to think about Lebanon? I sure as hell won't be vacationing there.

Anyway -- with the car lineup above -- I can agree with most of it. Ford can and should do more with what the consumer wants. It takes money to make money.
 

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Definetly not good. Ford needs to make more visually appealing cars, like fusion. They need better quality and reliability and to convince people of this to compete with the Japanese brands. They also need better fuel economy for this reason.

the company should save some money now that Mulally (SP?) isn't spending 70k for flights to his house in florida. :shock:
 

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[quote author=MZ6ZoomZoom link=topic=67832.msg1168173#msg1168173 date=1169732137]

The fourth-quarter loss was the worst final-quarter loss in Ford's history and its second-worst quarterly performance. Ford lost $6.7 billion in the first quarter of 1992, due mainly to accounting rule changes on health care liabilities.

[/quote]

as this say, its not compleatly due to fords vehicle line up.

that said when u bash the cars, fusion has had record sales and regardless of ur bashing this is a fusion board and we all for the most part love our car,

focus is being remodeled this year and hopefully we will get the euro focus in years to come but you have to remember americans dont want an expensive small car a euro focus is nicer but who would buy it.

the F series is still the best pickup and alot of ppl still need pickups for work.

anyways ford losing money is nothing new and the company has been aware of this and bracing for it. the fusion was the first car to get ford back on its feet and its doing amazing, the edge is another gamble that in our market will pay off i think. ford is going to put alot of advertising behind this car and it looks hot. crossovers sell right now and the edge will sell this summer.


as far as fuel economy in 08 ford is still stated to release a hybrid fusion. so they are taking there highest selling car thats kicking ass. making it hybrid. it isnt hard to see that ford has another winner on the horizon.
 

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This is such a shame. I can't believe that a car company that pretty much stared it all is doing so horrible. I think they should stop dumping millions of dollars into new cars for the US and bring over some of the British fords that do very well. (Mondeo, Ka, Focus ST, Falcon, Puma)
 

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Discussion Starter · #10 ·
[quote author=Showtime link=topic=67832.msg1169202#msg1169202 date=1169764868]
That's right, Hezobola is a peace organization . :screwy:
[/quote]

Hezbola is not the state. And actually, they're the single largest humanitarian aid organization in the middle east, last I checked. But yes, they also have their terrorist arm. Regardless, it isn't the state.



Since when did we not have to think about Lebanon? I sure as hell won't be vacationing there.
Much of my family and friends and their families do. Beruit is beautiful.
 

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The losses this year were expected. It may not be the exact number they expected but Ford was prepared to lose 10s of billions. This is just another example of sensationalistic reporting. Yes it sucks in the short term but Ford is doing what it needs to do to compete.
 

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[quote author=NaplesBill link=topic=67832.msg1170247#msg1170247 date=1169831140]
The losses this year were expected. It may not be the exact number they expected but Ford was prepared to lose 10s of billions. This is just another example of sensationalistic reporting. Yes it sucks in the short term but Ford is doing what it needs to do to compete.
[/quote]
Bill,
I have to disagree. I don't believe reporting facts is sensationalism at all. This following report from CNNMoney is typical. It doesn't contain any editorializing that I detect; just a lot of grim news.

The last paragraph is particularly telling. I'd like to see Ford right its financial ship just as much as you would, but it is doubtful that this is going to happen in 2007, 2008 or 2009, regardless of how many new products are introduced.

The last paragraph of this CNNMoney story is especially bleak.

Ford: Biggest loss ever
Annual shortfall roars past company record, as quarter loss comes in wider than expected; larger operating losses ahead.

By Chris Isidore, CNNMoney.com senior writer
January 25 2007: 11:28 AM EST

NEW YORK (CNNMoney.com) -- Ford Motor Co. reported the largest annual loss in company history Thursday. The embattled automaker also posted a fourth-quarter loss that was worse than analysts' expectations and warned of worse showings ahead.

Weak sales of its key pickup trucks in the quarter and $9.9 billion in after-tax charges due to employee buyouts and plant closing plans resulted in $12.7 billion loss for 2006.

Weak sales of the Ford's best-selling F-series pickup truck helped cause a bigger than forecast loss at the embattled automaker.

That works out to a loss of just over $24,000 a minute throughout the course of the year, or about the price of a Ford Mustang.

As bad as the financial report was, it did not shock Wall Street. Shares of Ford (up $0.26 to $8.46) gained about 3 percent in morning, as revenue came in slightly better than forecasts, and company officials offered more details of the results on a conference call.

"We know where we are, we're dealing with it and we're on plan," said Ford CEO Alan Mulally about the company's turnaround plans.

Mulally faced numerous questions from reporters during the call about plans by Ford to again start paying bonuses to white-collar employees despite the losses, and whether that would make it difficult to win further concessions it will be seeking from the United Auto Workers union. The Wall Street Journal reported Thursday that union concerns about the bonuses could hurt negotiations.

Mulally said no decision had yet been made about executive bonuses, but he confirmed it is something Ford is looking at and defended the idea of paying the bonuses, even at a time of record losses. He said Ford needed to makes sure pay for all its employees, both salaried and hourly, was competitive so that it did not lose the people it needs to execute the turnaround.

"We use the word bonus, but it is a key piece of their compensation, and that's how we pay them for the performance they're achieving," he said. "We need the absolute best-skilled and motivated team in all of the positions."

The UAW is in the process of negotiating some plant-by-plant contracts with Ford as the company weighs which plants it will close in coming years. And the union's company-wide contract with Ford and the other Detroit automakers expires in September.

Mulally said he's been pleased by the tone of negotiations with the union since he got to the company in September and is confident the union leadership is also committed to making the changes needed to stop the losses.

"I am very pleased...with the UAW's response in working all the elements to improve our productivity," he said.

Continued sales slide hits results

The company has seen a big drop in consumer demand for its key products, such as the F-series pickups. While still the nation's best-selling vehicle, the pickup saw sales plunge by more than 100,000 in 2006 in the face of record fuel prices and a slump in the housing market, which cut demand from contractors.

As the higher fuel prices drove Americans back to car models, Ford was left with a weak product lineup. Its Taurus sedan, once the nation's best-selling car, was discontinued in 2006 after years of seeing most of the demand for the model come from rental car companies.

It also got out of the business of making minivans last year as it struggled to play catch-up in the hot "crossover" segment that provides buyers with a more car-like drive for a larger family vehicle.

The shift in buyers' preference left Ford with numerous truck factories that were idle much of the quarter, even as unionized hourly workers continued to be paid near full salary. It responded to the downturn by offering all 75,000 of its U.S. factory workers buyouts or enhanced retirement packages to leave the company, which more than half of them agreed to do.

Most of the charges related to those downsizing efforts. The 2006 loss compares to restated net income of $1.4 billion in 2005, when earnings from its credit unit overcame auto losses.

The company's prior worst loss on record was 1992, when a charge for a change in accounting practices led to a net loss of $7.4 billion. The last time the company posted a full-year loss was 2002.

Losses excluding special items, such as the buyouts and plant closing charges, came to $2.8 billion for the year, or $1.50 a share. That compares with a earnings of $1.9 billion, or $1 a share on that basis a year earlier.

And while the company said the lack of large special charges should trim its net loss this year, it warned that losses excluding special items would be worse this year than in 2006. It did not give any specific range for that loss in its financial statement.

The company's larger operating losses in 2006 came even as it trimmed $1.4 billion in costs during the year on savings in its retiree health care program from the UAW and from a decline in both its hourly and white collar staff.

Even with the changes in the health care plans, the company spent $3.1 billion on U.S. health care in 2006, or an average of about $1,200 per vehicle, putting it at a cost disadvantage with some overseas automakers who have health care costs of workers building imported vehicles paid by foreign governments.

A report in the Wall Street Journal earlier this week said Ford and the other Detroit automakers were looking at funding union-controlled trust funds with billions in cash and equities in order to shift the responsibility for future retiree health care costs away from the companies to the union.

Mulally said no decision had been made on such a plan, but said that the company was looking at similar labor deals at other companies, such as Goodyear Rubber & Tire, which he referred to as innovative.

"In our dialogue we have everything on the table," he said.

Even with the cost savings already achieved, the drop in sales volume cost it $3.3 billion compared to 2005, and lower pricing on the vehicles it did sell cost another $1.9 billion.

For the fourth quarter, Ford posted a loss from continuing operations of $2.1 billion, or $1.10 a share, excluding special items. That compares to a profit of $285 million, or 15 cents per share, a year earlier, again on earnings from the credit operations.

Ford ended the year with 37,700 salaried employees in North America, down almost 5,000 from a year earlier, and 77,900 hourly employees in the region, down nearly 8,000 from a year earlier. It plans to cut another 18,000 to 23,000 hourly positions and 9,000 salaried jobs by 2008.

Analysts surveyed by earnings tracker First Call had forecast a loss of $1.01 a share, with estimates ranging from a loss of 75 cents a share to $1.52.

Revenue for the quarter was $40.3 billion, down $6 billion from a year earlier, as auto revenue fell $4.7 billion to $36 billion. First Call had been forecasting auto revenue of $34.7 billion for the period.

Ford, which had long been the nation's No. 2 automaker behind General Motors, fell behind Toyota Motor in U.S. market share in the fourth quarter, and even fell behind DaimlerChrysler in U.S. sales in November.

GM and DaimlerChrysler's Chrysler Group are also expected to post losses in the fourth quarter, as they lose market share to Japanese automakers such as Toyota and Honda Motor.
 

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Reporting facts is not sensationalism. Editorializing it as some great and unexpected event is! Ford was prepared for this and Wall Street did not react either. I'm not referring to this particular article only to the gloom and doom that many others are making this into. The most telling paragaph in that article is very short.

As bad as the financial report was, it did not shock Wall Street. Shares of Ford (up $0.26 to $8.46) gained about 3 percent in morning, as revenue came in slightly better than forecasts, and company officials offered more details of the results on a conference call.
 

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What is most sad about his is that when you visit other chat rooms there are Americans that are happy about an American Icon, a part of American history having trouble. Much of what Ford needs to overcome is image. Thier cars/trucks are actually very good/reliable vehicles. What the media doesn't tell you is that Ford told people things are going to get worse at Ford before they get better. Ford will pull out of this by 2009/10 time frame.
 

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I don't understand why so many americans are like this as you say towards ford. When it comes to affordable cars they're just as good if not better than their japanese/korean counterparts. Nobody can really touch the germans when it comes to engineering but look at what you pay. I didn't buy ford because it was american or because of its history but those were major factors, I bought my fusion because it was a solid car-much better than an accord including the price tag. If they release more good cars and market themselves well they can pull out of this
 
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