range Posted November 9, 2007 Share Posted November 9, 2007 The Nov 9th edition of the Wall Street Journal says: "The surprise: Ford Motor Co, not General Motors Corp, suddenly appears to be on a faster track to profits." The article goes on to say that a linchpin of Ford's improved performance is discount discipline. SO, when the monthly sales reports come out and people on here whine, just remember that playing the Toyota Tundra how-high-can-we-go rebate game or the GM build-them-and-they-will-come-and-discount-them-when-they-don't game or the Chrysler build-them-and-sell-them-to-Thrifty-Rent-a-Car strategies are NOT winning strategies. Quote Link to comment Share on other sites More sharing options...
igor Posted November 9, 2007 Share Posted November 9, 2007 do not worry - NO ONE will remember the financial results when the November sales will roll around - it will be a whine fest all over again. Igor Quote Link to comment Share on other sites More sharing options...
jpd80 Posted November 9, 2007 Share Posted November 9, 2007 GM only pretends to reform its business, Ford is actually doing it every week of the year. Quote Link to comment Share on other sites More sharing options...
FordBuyer Posted November 9, 2007 Share Posted November 9, 2007 The Nov 9th edition of the Wall Street Journal says: "The surprise: Ford Motor Co, not General Motors Corp, suddenly appears to be on a faster track to profits." The article goes on to say that a linchpin of Ford's improved performance is discount discipline. SO, when the monthly sales reports come out and people on here whine, just remember that playing the Toyota Tundra how-high-can-we-go rebate game or the GM build-them-and-they-will-come-and-discount-them-when-they-don't game or the Chrysler build-them-and-sell-them-to-Thrifty-Rent-a-Car strategies are NOT winning strategies. UBS forecasted today that they believe Ford will break even this year, show .50/share profit in 2008 and $1.50 in 2009. Their new target price is $9 and won't go higher because of lack of new product and stiffer headwinds. But at least Ford is stablilzing balance sheet wise and burning cash at slower rate. Ford is most assuredly stabilizing and GM so far is not. The new Edge is the homerun Ford needed and only if they could get another homerun soon. I think the new Flex has a chance to enjoy Edge success. I have seen the production version on road as I posted this past summer on here, and it really looks nice in decked out form on public roads. Definitely a polarizing head turner...just what Ford needs and a high volume model to boot. Quote Link to comment Share on other sites More sharing options...
snooter Posted November 9, 2007 Share Posted November 9, 2007 ...this does not surprise me considering the size difference between cheby and ford..what is sad i have been a ford guy (f150/stangs) my whole life (less the 73 super beetle ditch hopper back in 1984) and i cannot tell you 1 model ford is currently producing outside of the stang and the f150..ford has not done a good job of marketing vehicle types in my opinion as the last thing i new ford had outside those mentioned was the ford exp i bought new in 1984 (what a piece of crap-havent bought a ford car since)..i hope ford does get this turned around and if they have to close pants (ouch) or lay more people off (double ouch) to get profitable then i am all for it..ps mulally--please make a boss 302 again Quote Link to comment Share on other sites More sharing options...
snooter Posted November 9, 2007 Share Posted November 9, 2007 (edited) ...this does not surprise me considering the size difference between cheby and ford..what is sad i have been a ford guy (f150/stangs) my whole life (less the 73 super beetle ditch hopper back in 1984) and i cannot tell you 1 model ford is currently producing outside of the stang and the f150..ford has not done a good job of marketing vehicle types in my opinion as the last thing i new ford had outside those mentioned was the ford exp i bought new in 1984 (what a piece of crap-havent bought a ford car since)..i hope ford does get this turned around and if they have to close plants (ouch) or lay more people off (double ouch) to get profitable then i am all for it..ps mulally--please make a boss 302 again ps.i did buy a probe gt new in 1994 and of course ford saw fit to discontinue that car (usual luck-i like something its usually gone in a year or two)..i did like the probe.. Edited November 9, 2007 by snooter Quote Link to comment Share on other sites More sharing options...
MarkFive Posted November 9, 2007 Share Posted November 9, 2007 GM only pretends to reform its business, Ford is actually doing it every week of the year. I think GM is reforming its business, but the negative reporting of the media has been focused on Ford for a while now. This is why this week has been so interesting. Suddenly GM comes out with a loss that is three times the Ford loss from last year - which was so widely reported on by the media. I think Ford is on the right track. I hope that GM is as well as there are a lot of people tied to that company, and when the company does well, so do they. Quote Link to comment Share on other sites More sharing options...
eddiehaskell Posted November 9, 2007 Share Posted November 9, 2007 I think GM is reforming its business, but the negative reporting of the media has been focused on Ford for a while now. This is why this week has been so interesting. Suddenly GM comes out with a loss that is three times the Ford loss from last year - which was so widely reported on by the media. THREE TIMES?!? That was an accounting exercise - nothing more (i.e. not real money). Excluding special items, GM had a 2007 third-quarter adjusted net loss of $1.6 billion, or $2.80 per diluted share, compared to net income of $497 million, or $.88 per diluted share, in the year-ago quarter. The variance was driven primarily by a significant decline in net income at GMAC, as well as increased corporate expense related to legacy cost, foreign exchange and various 2006 tax benefits, partially offset by improved performance in automotive operations. GM Automotive Operations GM's global automotive operations posted net income of $122 million from continuing operations on an adjusted basis in the third quarter of 2007 (reported net loss of $40.6 billion), an improvement of $577 million compared to an adjusted net loss from continuing operations of $455 million (reported net loss of $401 million) in the same quarter 2006. Results for GM's automotive operations, specifically GMNA, exclude Allison Transmission, which was classified as a discontinued operation as a result of the sale of that business which was concluded in August 2007. Quote Link to comment Share on other sites More sharing options...
igor Posted November 9, 2007 Share Posted November 9, 2007 yes their automotive operations are in a better shape .. but now their credit arm is losing money ...and real money or not - it is money - and $36 billion is one HELL of an accounting exercise - and GN has made a TON of them over past 2 years -makes you wonder how doctored really ARE their books. Igor Quote Link to comment Share on other sites More sharing options...
range Posted November 9, 2007 Author Share Posted November 9, 2007 THREE TIMES?!? That was an accounting exercise - nothing more (i.e. not real money). uhhhhh no, that is not correct. That loss is EXCLUDING special items. "Excluding special items, GM had a 2007 third-quarter adjusted net loss of $1.6 billion, or $2.80 per diluted share, compared to net income of $497 million, or $.88 per diluted share, in the year-ago quarter." Quote Link to comment Share on other sites More sharing options...
eddiehaskell Posted November 9, 2007 Share Posted November 9, 2007 uhhhhh no, that is not correct. That loss is EXCLUDING special items. "Excluding special items, GM had a 2007 third-quarter adjusted net loss of $1.6 billion, or $2.80 per diluted share, compared to net income of $497 million, or $.88 per diluted share, in the year-ago quarter." What is hard to understand? Excluding the accounting exercise they lost 1.6B.....mostly due to GMAC. The automotive business was profitable and has been for all 3 quarters. Quote Link to comment Share on other sites More sharing options...
Deanh Posted November 9, 2007 Share Posted November 9, 2007 What is hard to understand? Excluding the accounting exercise they lost 1.6B.....mostly due to GMAC. The automotive business was profitable and has been for all 3 quarters. Eddie, I'm starting to beleive you are a GM defender no?........they suck...LOL! seriously I don't think they have ONE product that I would even consider....or Dodge for that matter..... Quote Link to comment Share on other sites More sharing options...
Pioneer Posted November 9, 2007 Share Posted November 9, 2007 If Ford is doing so good, why did the stock go down almost 4% today? Stupid stock market. Quote Link to comment Share on other sites More sharing options...
DCK Posted November 9, 2007 Share Posted November 9, 2007 Ford is doing better on the financial side, there is no question, but they are not doing nearly as good on the product side, and eventually that is what matters most, so Ford saved money and didn't spend money on product, their product line and sales show that. The fact is Ford needs much better product, and instead of spending money to get that product here faster, like GM did, they are waiting until 2012-2013 until models change over in Globally to get better product to us. Quote Link to comment Share on other sites More sharing options...
eddiehaskell Posted November 9, 2007 Share Posted November 9, 2007 Ford is doing better on the financial side, there is no question, but they are not doing nearly as good on the product side, and eventually that is what matters most, so Ford saved money and didn't spend money on product, their product line and sales show that. The fact is Ford needs much better product, and instead of spending money to get that product here faster, like GM did, they are waiting until 2012-2013 until models change over in Globally to get better product to us.Exactly. These are automotive companies after all. Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted November 9, 2007 Share Posted November 9, 2007 (edited) Ford's NA ops lost $1B, that's worse than what GM did. However, GM's overall auto ops are in worse shape than Ford. Compare YTD performances outside NA for confirmation. Furthermore, GM laid off 3k people after the UAW ratified the deal. That is bad bad bad for labor relations. By comparison, Ford is likely to buy out an additional 4-5k employees. Ford sources quoted as saying that unlike GM & Chrysler, they would not 'violate the union's trust'. Ford had revenue $1B higher this quarter on substantially lower volume in NA. That means they're doing something right. GM, OTOH had flat revenue in NA, which is inline with publicly reported information suggesting that they have increased incentives as they've increased sales. Edited November 9, 2007 by RichardJensen Quote Link to comment Share on other sites More sharing options...
MarkFive Posted November 9, 2007 Share Posted November 9, 2007 The new Edge is the homerun Ford needed and only if they could get another homerun soon. I think the new Flex has a chance to enjoy Edge success. I have seen the production version on road as I posted this past summer on here, and it really looks nice in decked out form on public roads. Definitely a polarizing head turner...just what Ford needs and a high volume model to boot. I think the new MKS is also going to be successful - on top of this, Ford is doing well in recent quality surveys. The one thing they need to do is consistently advertise (product AND quality). Hopefully the new guy from Toyota will take care of that the sooner the better. Quote Link to comment Share on other sites More sharing options...
NickF1011 Posted November 9, 2007 Share Posted November 9, 2007 What is hard to understand? Excluding the accounting exercise they lost 1.6B.....mostly due to GMAC. The automotive business was profitable and has been for all 3 quarters. Well heck, excluding special charges, Ford didn't lose $10B last year either. It's all a shell game when it comes down to it. Quote Link to comment Share on other sites More sharing options...
range Posted November 10, 2007 Author Share Posted November 10, 2007 As the WSJ said, GM's performance is troubling. GM started their "turnaround" plan long ago, and long before Ford. The problem is, GM's turnaround plan has not gained any traction. Quote Link to comment Share on other sites More sharing options...
eddiehaskell Posted November 10, 2007 Share Posted November 10, 2007 (edited) Well heck, excluding special charges, Ford didn't lose $10B last year either. It's all a shell game when it comes down to it.I'm not saying you should totally exclude special charges, but if you want to see how there automotive business is doing it would be foolish to include special charges. Was Ford's automotive business doing so bad that they lost 12.7-billion? No, much of that was due to restructuring. For example, if GM earned $6-billion from GMAC and their auto business lost $3-billion - they made a $3-billion profit. Does that mean the automotive business is doing well? Edited November 10, 2007 by eddiehaskell Quote Link to comment Share on other sites More sharing options...
range Posted November 10, 2007 Author Share Posted November 10, 2007 "Excluding special items, GM had a 2007 third-quarter adjusted net loss of $1.6 billion, or $2.80 per diluted share, compared to net income of $497 million, or $.88 per diluted share, in the year-ago quarter." Thats a $2 Billion swing to the negative over Q3 2006. Not a good performance. Quote Link to comment Share on other sites More sharing options...
jobu37 Posted November 10, 2007 Share Posted November 10, 2007 For all intent and purposes GM should be blowing Ford away at this point in time due to the fact that they should be enjoying the robust profit per sale that an all new version of their top money maker the Silverado/Sierra should produce. But instead their ego has led them to discount this brand new product to the levels of a truck in it's last model year before an upgrade. Ford and GM and Chrysler are all the same in that they make most of their money on their full-size trucks. The fact that GM is not profitable in NA in the first year of production of a brand new version of their moneymaker does not bode well for the next few years. IIRC, GM loss $200 million in NA in the last qtr. Ford on the other hand is in the last model year for their top moneymaker. As one would expect they are discounting them more heavily. Definitely more than they would like but when you have Dodge at $7,000+ per unit and Toyota around $5,000+ per unit and GM discounting around $3,000 to $4,000 it is an accomplishent that you are still moving adequate volume when you are still on the lower end of the discounting spectrum relative to others. However, it will most likely only get uglier next year. Ford lost $1 billion in the 3rd quarter in NA. More than $500 million of that can be directly attributed to the extra F-series rebates. Take into account the rebates being used to move the Expedition, Navigator, Explorer, Mountaineer and Lincoln LT and one could easily make the assumption that Ford is near breakeven on the car/CUV side. Of course the Edge is contributing alot of profit at this point in time but the amount that the Focus was surely discounted in September probably skewed the rebate average up across the car line. Theoretically, the new Focus will be selling at higher transaction prices and the Flex will contribute robust profits starting in May of next year so Ford will hopefully be able to offset the even higher rebates for the F-series in the first 3/4 of 2008. Qtr 1 and Qtr 2 look potentially very bad. Once the new F150 comes out late next year they should get 2 or 3 months of sales with virtually no rebates and then slowly slide into more aggressive discounting. As long as they manage it in a sensible way and don't let ego get into the equation they should be able to outperform both of their crosstown rivals on the financial front. Considering the fact that they have not succumbed to the pressures to look good in monthly sales and have stuck to their plans to reduce fleet sales for a whole year now makes me think they have the stomach to stick with the use of common sense in regards to doing things that are financially right instead of letting the old school car guy thinking of marketshare first take control of them. On the flip side of all this is the fact that Ford has benefited from getting most of their factories to agree to the COAs long before the new contract. GM had much less luck at this. So common sense tells me that GM will gain more efficiencies under the new UAW contract than Ford will. The question is how much more and only time will give us the answer to that question. Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted November 10, 2007 Share Posted November 10, 2007 (edited) i was cogitating the flip side of this today. Ford's NA revenue was up $1B this quarter. I was trying to figure how much of that was due to better product mix from the Edge & Fusion over the rental fleet Taurus.... Also I think Q3 last year was one of the quarters where Ford really scaled back production to reduce inventory. Edited November 10, 2007 by RichardJensen Quote Link to comment Share on other sites More sharing options...
bystander Posted November 11, 2007 Share Posted November 11, 2007 Ford is doing better on the financial side, there is no question, but they are not doing nearly as good on the product side, and eventually that is what matters most, so Ford saved money and didn't spend money on product, their product line and sales show that. The fact is Ford needs much better product, and instead of spending money to get that product here faster, like GM did, they are waiting until 2012-2013 until models change over in Globally to get better product to us. You're exactly right. GM has been much more aggressive and effective in turning out new product. Although Ford has launched some winners in the past few years (Fusion, Edge), they are not moving fast enough to revamp their rapidly sinking product line. People are down on GM because they reported a shocking $39 billion quarterly loss due to a balance sheet adjustment required by accounting rules. It was not a reflection of the strength of their cash position. Quote Link to comment Share on other sites More sharing options...
ironhorse Posted November 11, 2007 Share Posted November 11, 2007 What is GM's cash position?...anyone know? Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.