Just as the title says. I got into a bit of an argument earlier today with an uninformed person, stating that he cannot believe GM wasted time building the Camaro when "we need economical cars, it's no wonder why GM is where it is." Besides educating him about the Camaro itself, and how cars like Camaro and Mustang are actually profitable and sell reasonably well, he countered with "Ford will be asking for Government money soon too, so Mustang isn't helping them too much."

I figured you guys might be a bit more informed about Ford's current position. Obviously, seeing the mess that GM and Chrysler are involved in I would think Ford would run as far away from Gov't Cheese as possible, if at all possible. So, how long can Ford continue to survive on its own?

 

At least as of yesterday, Ford were strongly in favor of maintaining their financial independence.

http://www.bloomberg.com/apps/news?p...WLIhI&refer=us

Ford's public perception is benefitting from not borrowing money and they have a genuinely world-class small car - Fiesta - in the pipeline.

They still have 21 Million in cash, but there are risks. If the market stayed at this depressed level for a prolonged period of time and/or a few of their suppliers went down I think it's still possible they could need to borrow.

And you're right - Camaro IS profitable and selling very well. And it's actually pretty darn efficient for what it is. The V6 is comparable to just about any family sedan and the SS is class competitive.

 

Yeah, the name of the game is profit. Cars like the Mustang, especially the GT make a lot of cash for Ford. Just about anything sold for over $30,000 is making good money with a few exceptions.

Tell him small cheap cars are the least profitable cars sold.

Ford has a lot of diverse products coming out, more fuel economy, more performance, more updated everything. Fusion hybrid best the Insight by 1mpg city, 2011 Focus is all new and like the 2011 Fiesta it should get 40mpg why. Next Explorer (2011MY) is expected to get an Ecoboost engine and get ~20% better fuel economy over the 2009.

Make sure you let him know Camaro gets 29mpg and that is better than most import V6 powered cars.

 

There is no doubt flaws in his thinking. Everyone thinks that this new Camaro could save GM. And this direct injected 300 horse V6 seems to be the best thing since sliced bread.

As far as Ford goes all signs point to the fact that once this Fiesta gets released as well as the new Mustang they will be sitting pretty. Even though sales have declined drastically, the F-150 will always be the number one selling truck in America (God I hate that). So I think if Ford can survive this long without getting any handouts, they could probably see this thing through until the market bounces back again.

But the Mustang and Camaro can be nothing but profitable for both GM and Ford because they will always have people waiting to get their favorite Pony cars. You have to remember some people were crying when they saw the 2006 concept for the first time. God Bless America.

Just my personal thoughts, don't really know whats going to happen anymore.

 

Ford looks healthy mainly because they're standing next two guys in the ICU. Their debt is still worth 50c/dollar, and they are printing new stock to capitalize themselves. However, they have a strong line of products coming, and they are poised to gain marketshare from GM/Chrysler.

Also, this board has declared a lot of cars to be "profitable" that turned out to be money-losers. However, with all the bad news and potential Chapter 11, the Camaro is super-critical marketing for GM & Chevrolet and their core customer-base. As they say around here, "Keep the faith!".

 

Ford WILL NOT take any government money. That is not on the table, no matter what.

Rumor has it, that Ford does have access to more money, should it be needed. However, right now, they are doing good by reducing their debt with debt/equity swaps, and selling additional stock to raise money to fund VEBA and operations. This last sale was done at $4.50, and all was sold in 1 day. While it does dilute stock value, markets responded with the stock price going back up to over $5.25 in a few days.

I guess that tells you how the markets feel about Ford.

Ford will milk their differences from GM and Chrysler, for all they are worth, and they should.

 

I dont think the Ford family will want to give up control to the goverment and will do anything and everything to make sure that doesnt happen.

 

Ford deciding to stay independent has improved my opinion of the Company 10-fold.

 

I honestly think Fords over investment in small cars like the Fiesta and Focus will be a problem in 1-2 years when the economy is better. When times are good, American's move fast away from small..to either sports cars, big cars, minivans, or SUV's.

 

Probably doesn't answer the original question posed but all I keep hearing is that Ford are almost invincible. But they still manufacture cars that are not exactly flying out the door. That being the case, how could Ford be in great shape if they keep losing market share to other brands?

 

Honda sells a lot of Civics in good times, as does Toyota with the Corolla and Prius. Ford needs first class small cars if they want to be competitive.

Plus the only reason gas is so cheap now is because the economy is so bad. When things turn around demand for energy will be higher and prices will go up along with it. I think Fords new smaller cars might be timed perfect with the return of $3+ gasoline. Same goes for the Cruze and Volt.

 

Ford has gained retail market share in 6 of the last 7 months.

Also, their overall sales declines have been less than GM and Chrysler, and more in line with Toyotas (in other words, average for the current market).

The biggie, is that Ford has aligned production to demand, so they do not have huge amounts of unsold inventory. Last I heard, they had 80 days worth of inventory, compared to GM with 115-120 days (I don't remember the exact number). 80 days may seem like alot, but in encompasses vehicles that have huge amounts of model variations, like trucks. Car inventory is very low.

As for product mix, they are working hard to make sure that they have a balanced portfolio, so that, no matter what the selling conditions are, they will be able to adjust to serve the conditions. Need more cars................ crank them up. Need more trucks............... crank them up. This will give them the flexibility that they need, in an ever changing marketplace.

 

Ford is better off than some, but they are in trouble.

If sales don't turm soon they will be looking for government help.

I agree that Ford is using their own cash to stay afloat. It's a finite amount.

Ford has extended their employee buyout deadline. I presume because not enough employees have responded.

We will see what washes out. I suspect that if the government and the UAW are in the ownership position at GM and Chrysler many loans will be written off.

Forgiven debt is not debt once forgiven.

Not a possibility for Ford given their present position. It's an advantage now but that could 180 in a heartbeat.

I wish them well, but bear in mind, Ford can end up being in business vying for business against a company or companies controlled by the regulating entity. Not that enviable if they are burning their own cash to keep up.

It's a bit harder to be agile if the government can dictate what you will be able to sell at a profit. If anyone thinks the government will not do what it takes to no pay the political price for a failure of their involvement you are sadly mistaken.

I don't know what the government will do. I do know they don't want to pick up the UAW pension and healthcare obligations. Notions that the markets can't be manipulated for political gain are foolish at best.

If Ford isn't worried, they should be.

 

You must be seeing things that most customers apparently don't.

Ford is still a Detroit company. It's no better or worse than it's domestic rivals in the eyes of analysts, as well as the true measure, the actual buyers. Even some of Ford's new models are not as convincing as some cheerleaders would have me believe.

On a personal level, I can't see myself ever driving uninspiring cars like Fiesta, Focus, Taurus, Fusion etc... BLAND with a capital "B"! The only Ford I'd seriously consider owning would be the Mustang... but not when there is a legitimate GM rival like a Camaro (or even a Chev "G8") around. You could say, "well that's just you!" but how many other buyers out there have suddenly found faith with Ford? The sales figures suggest not many, not even when GM and Chrysler are both down on their knees.

Still looks like the same Ford, 'pre-Mulally', to me... so what am I missing?

 

http://online.wsj.com/article/SB124119420214677663.html