RichardJensen Posted February 26, 2009 Share Posted February 26, 2009 When will for ask for Federal help? Hard to say. I think some of Ford's sales projections that they are basing their recovery timetable on are overly optomistic. Visteon could be a real nasty problem too. After this many years, I think Ford knows there way around Visteon pretty well. Their exposure to Visteon now is solely the risk of bankruptcy. No Visteon liabilities are going to get thrown back on Ford. --- Ford's sales projections for the last few years have consistently been more pessimistic--but more importantly--more accurate than Chrysler's and GM's. While I am concerned that Ford may be a bit too rosy, they have been more accurate of late than either of the other two. Quote Link to comment Share on other sites More sharing options...
J-150 Posted February 26, 2009 Share Posted February 26, 2009 I dunno, perhaps the Canadian government should subsidize a foreign corporation with Canadian tax money and see how their voting population enjoys it while the rest of their domestic industry teters toward bankruptsy and double digit unemployment? they already do support Honda and Toyota The unique situation in Canada is that ALL assembly plants are in the same province (state) versus in the US where the domestics reside primarily in the rust belt and the imports find themselves in the South. Quote Link to comment Share on other sites More sharing options...
smok Posted February 26, 2009 Share Posted February 26, 2009 "A little more than two years ago, Ford secured a $23 billion line of credit to fund its now-scrambled turnaround, then called "The Way Forward. The main reason that Ford doesn't need a government bailout now is that it already received the private-sector equivalent." This is key. Most people don't know this.. How long can Ford survive? Way too many unknowns. But they will ask for gov't money once they have no more cash left. So, I say a year and a half if the market stays at 10 million/yr. When people are out of a job, or scared of losing their job, lost 40% on their 401K and lost 30% on their house value, last thing they think about is a new car. Ford better get used to being a smaller company for the next couple of years or so. Quote Link to comment Share on other sites More sharing options...
smok Posted February 26, 2009 Share Posted February 26, 2009 they already do support Honda and Toyota The unique situation in Canada is that ALL assembly plants are in the same province (state) versus in the US where the domestics reside primarily in the rust belt and the imports find themselves in the South. I'd say all auto makers are foreign to Canada. Canada doesn't have its own auto maker, EH? Quote Link to comment Share on other sites More sharing options...
jpd80 Posted February 26, 2009 Share Posted February 26, 2009 Sorry guys for being late to the thread, I recall Mulally saying recently that Ford remains comitted to right sizing their production capacity to sales volume. I gather from that, Ford will continue reducing costs to get through this tight period. I think Ford now sense that the "Last mand standing" wins the market and the respect of the American people. Sometimes it's good to hang tough, the American people appreciate a "fighter" and probably see Ford as a winner....... Quote Link to comment Share on other sites More sharing options...
silvrsvt Posted February 26, 2009 Share Posted February 26, 2009 When will for ask for Federal help? Hard to say. I think some of Ford's sales projections that they are basing their recovery timetable on are overly optomistic. Visteon could be a real nasty problem too. I guess you didn't see what GM was basing their figures off of to repay the goverment by 2017 or what ever it was...18 million cars a year? at best you can sell 16 or so Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted February 26, 2009 Share Posted February 26, 2009 Most people don't know this.. I should've added that comment about a 'private sector bailout' to the "asinine remarks" post. Know why? Ford has been dutifully paying interest on that 'bailout' every quarter, they had to pass far more severe analysis to be approved for those loans than GM & Chrysler, and that they were staked private, not public money. To argue any equivalence in underwriting or ongoing costs between Ford's private money and GM & Chrysler's public money... wrong headed. Also, Ford did not borrow operating cash. GM and Chrysler plainly have. Quote Link to comment Share on other sites More sharing options...
jpd80 Posted February 26, 2009 Share Posted February 26, 2009 (edited) Comparing Ford and GM's cash burn is ridiculous, Ford is almost finished its restructuring, GM is just trying to function............. Also, Ford is not offering its bond holders 30 cents on the dollar like GM is at present.... Update: GM will offer 10 cents on the dollar and government loans will provide the other 20 cents. Edited February 26, 2009 by jpd80 Quote Link to comment Share on other sites More sharing options...
FordBuyer Posted February 26, 2009 Share Posted February 26, 2009 If Ford can remain solvent until the Fiesta and new Focus come out, I believe Ford will make it. Hopefully, Ford's sales will improve enough as year progresses so that they can at least squeak through without using Government money and get these important high sales vehicles out. The new Fusion and Taurus should improve sales enough to squeak by. Quote Link to comment Share on other sites More sharing options...
akirby Posted February 26, 2009 Share Posted February 26, 2009 New Mustang, new Fusion/Milan/MKZ, MKT and Transit Connect should provide at least 100K additional units for 2009 (beyond the current volumes). Quote Link to comment Share on other sites More sharing options...
03 LS Posted February 26, 2009 Share Posted February 26, 2009 1st, How long can Ford survive? Way too many unknowns. But they will ask for gov't money once they have no more cash left. So, I say a year and a half if the market stays at 10 million/yr. If market stays at 10 million/yr, Ford will need gov money in either Q3 or Q4 this year. In their last update, where they expected 11.5-12.5 SAAR and no bail-out, they anticipated a 10m or sub-10m SAAR for Q1 and Q2. This implied they expected 13m - 15m SAAR for 2nd half of '09. If it remains at 10m for the whole year, Ford will not survive by itself. 2nd, If Ford can remain solvent until the Fiesta and new Focus come out, I believe Ford will make it. Hopefully, Ford's sales will improve enough as year progresses so that they can at least squeak through without using Government money and get these important high sales vehicles out. The new Fusion and Taurus should improve sales enough to squeak by. Ford's forcast is very conservative on market share (maybe too optimistic on SAAR), it did not count on market share gains, which newer/better products will likely bring. They can't wait for 2010, whatever they sell in 2009 will have to work. Quote Link to comment Share on other sites More sharing options...
NickF1011 Posted February 26, 2009 Share Posted February 26, 2009 To answer the question, "How long until Ford also needs bailout?" It depends on how many vehicles Ford sells this year. If sales don't get any worse, they will make it into 2010 but I don't think they could make it into 2011. Well that's all fine then. Ford projects that if sales maintain their current strength, they will be profitable by 2011 anyway. Quote Link to comment Share on other sites More sharing options...
NickF1011 Posted February 26, 2009 Share Posted February 26, 2009 When people are out of a job, or scared of losing their job, lost 40% on their 401K and lost 30% on their house value, last thing they think about is a new car. Unfortunately that's how too many people think. I can understand the first two concerns, but the value of your 401K and your home really shouldn't be impacting your thoughts on buying a car whatsoever. Your 401K and home should be considered long-term investments, not a piggy bank to borrow against. A vehicle should be thought of as nothing more than an immediate hole in your pocket and should only be based on what you can already afford out of pocket, not what percentage of your savings you are willing to waste on it. Then again, if everyone purchased vehicles that rationally, new vehicle sales would probably drop to 1.5 million a year. Quote Link to comment Share on other sites More sharing options...
Bored of Pisteon Posted February 26, 2009 Share Posted February 26, 2009 Toyota is just arrogant enough to ask our government for money, effectively holding U.S. jobs as hostage. What's scarier still is they'd probably get it. As far as I'm concerned. Let Toyota leave the country for all I care. Quote Link to comment Share on other sites More sharing options...
mackinaw Posted February 26, 2009 Share Posted February 26, 2009 If market stays at 10 million/yr, Ford will need gov money in either Q3 or Q4 this year. From today's Detroit Free Press, "Today, Ford said it could survive without assistance even if U.S. sales fall to the company’s worst-case scenario of 9.2 million cars and trucks." See article here: http://www.freep.com/article/20090226/BUSINESS01/90226052 Quote Link to comment Share on other sites More sharing options...
jpd80 Posted February 26, 2009 Share Posted February 26, 2009 1st, If market stays at 10 million/yr, Ford will need gov money in either Q3 or Q4 this year. In their last update, where they expected 11.5-12.5 SAAR and no bail-out, they anticipated a 10m or sub-10m SAAR for Q1 and Q2. This implied they expected 13m - 15m SAAR for 2nd half of '09. If it remains at 10m for the whole year, Ford will not survive by itself. 2nd, Ford's forcast is very conservative on market share (maybe too optimistic on SAAR), it did not count on market share gains, which newer/better products will likely bring. They can't wait for 2010, whatever they sell in 2009 will have to work. You could add a third, Product mix. If F150 sales continue to surge, Ford will be in the clear because it add so much to their bottom line. While an over reliance on one product is not healthy, I think we can forgive Ford in this instance. Quote Link to comment Share on other sites More sharing options...
Extreme4x4 Posted February 26, 2009 Share Posted February 26, 2009 Well, if I based F150 sales, on the new trucks I have seen in my small town ............... it would seem as if Ford has the entire new vehicle market all to themselves. The amount of F150's I have seen around here, has just exploded. It really is rather noticable. That said, a small story, based on what Nick said. My mortgage company keeps trying to get me to refinance, and pull all of our debt into our house payment (we are still paying off debt from our failed business, after 9/11). I told them to take a hike. We will likely have EVERYTHING except our house, and truck, paid off within two years. Why in Gods name would I be stupid enough to pay a 30-year mortgage on short term debt. I like the fact that I still have a bunch of equity in my home................... and intend to keep it that way. The ONLY reason you should borrow money on your house, is to improve your house. Anything else is just plain stupid. When I was a mortgage loan officer, I always talked my clients out of rolling their vehicle into their home................. and once I showed them the hard numbers............. the majority of the time, they agreed with me. Anyway, I think Ford will surprise alot of people. Its amazing what great management can accomplish. Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted February 26, 2009 Share Posted February 26, 2009 Why in Gods name would I be stupid enough to pay a 30-year mortgage on short term debt. And convert unsecured debt into secured debt! Quote Link to comment Share on other sites More sharing options...
03 LS Posted February 26, 2009 Share Posted February 26, 2009 You could add a third, Product mix.If F150 sales continue to surge, Ford will be in the clear because it add so much to their bottom line. Unfortunately, it is not. Everybody, including Ford, is predicting Feb. will be worse (or as bad) as Jan. F150 may gain market share, again, but sales number will be worse, no "surging" of any sort here. From today's Detroit Free Press, "Today, Ford said it could survive without assistance even if U.S. sales fall to the company’s worst-case scenario of 9.2 million cars and trucks." See article here: http://www.freep.com/article/20090226/BUSINESS01/90226052 I saw that too. I wonder what changed in their calculation. The VEBA concession was not in their previous assumption? Volvo sold for a "good" price? Got additional funding, from foreign gov, CAFE, whoever? Quote Link to comment Share on other sites More sharing options...
grbeck Posted February 26, 2009 Share Posted February 26, 2009 I should've added that comment about a 'private sector bailout' to the "asinine remarks" post. Know why? Ford has been dutifully paying interest on that 'bailout' every quarter, they had to pass far more severe analysis to be approved for those loans than GM & Chrysler, and that they were staked private, not public money. To argue any equivalence in underwriting or ongoing costs between Ford's private money and GM & Chrysler's public money... wrong headed. Also, Ford did not borrow operating cash. GM and Chrysler plainly have. So far, based on what I've seen, the only "analysis" GM and Chrysler have had to pass is saying, "We need more money." Well, that and whining about how hard it is to formulate a plan for recovery, because those mean old government officials are actually demanding sacrifices from management, bondholders, the UAW, etc. Quote Link to comment Share on other sites More sharing options...
matthewq4b Posted February 27, 2009 Share Posted February 27, 2009 I dunno, perhaps the Canadian government should subsidize a foreign corporation with Canadian tax money and see how their voting population enjoys it while the rest of their domestic industry teters toward bankruptsy and double digit unemployment? Little late on this one. But How about anouther $1 billion for our military's new MLVW's (Medium Logistic Vehicle Wheeled, aka a duece & a half) The 1 billion dollar contract for these trucks was awarded to Navistar and they will be built in Garland Texas and not the Navistar plant in Chatham Ont that is undergoing layoffs and faces closure. SO out Gov't is subsidizing a foreign corporation with Canadian tax money, And it is to keep your country men employed. Matthew Quote Link to comment Share on other sites More sharing options...
jpd80 Posted February 27, 2009 Share Posted February 27, 2009 Unfortunately, it is not. Everybody, including Ford, is predicting Feb. will be worse (or as bad) as Jan. F150 may gain market share, again, but sales number will be worse, no "surging" of any sort here. Ford will continue shrinking its business before ever taking any government money. Mulally and Ford know they are on a winner because the can smell the blood in the water.............. Quote Link to comment Share on other sites More sharing options...
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