News: Ford cuts debt by $9.9bn, sees 15% jump in stock price

Zuhaib

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From the BBC, http://news.bbc.co.uk/2/hi/business/7986272.stm
The US carmaker Ford has seen its shares rise by nearly 15% in New York, after saying it had cut $9.9bn(?6.7bn) from its $25.8bn debt.

The 38% debt reduction will reduce Ford's interest payments by more than $500m a year.

It said the move, along with previous agreements with the United Auto Workers (UAW) union, would "substantially strengthen Ford's balance sheet".

In morning trading Ford's shares were up 14.5%, or 47 cents, at $3.72.

'Strong positive'

"As with our recent agreements with the UAW, Ford continues to lead the industry in taking the decisive actions necessary to weather the current downturn and deliver long-term profitable growth," said Ford chief executive Alan Mulally in a statement.

Ford is the only one of the big three US carmakers that has not taken government bail-out money to enable it to continue operating.

"Clearly it is a strong positive for the company, the ability to reduce liabilities and the interest burden," Fitch Ratings managing director Mark Oline said.

"At this point the interest of the bondholders and equity holders are pretty much aligned. Both want Ford to survive the current environment."

Interesting as many thought Ford was pretty much being arrogant in not taking Gov money and now looks like the strongest of the 3.

To me that did not seem very clear as I thought GM had the stronger car offering of the 3 but I guess with Ford strong intentional business plus major cost cutting makes them stronger then the rest.

I wonder if GM enters bankruptcy if Ford might try to buy off chunks of them :eek:
 
*Crosses fingers*

Please buy Jeep from Chrysler!
Please buy Jeep from Chrysler!
Please buy Jeep from Chrysler!
 
From the BBC, http://news.bbc.co.uk/2/hi/business/7986272.stm


Interesting as many thought Ford was pretty much being arrogant in not taking Gov money and now looks like the strongest of the 3.

To me that did not seem very clear as I thought GM had the stronger car offering of the 3 but I guess with Ford strong intentional business plus major cost cutting makes them stronger then the rest.

I wonder if GM enters bankruptcy if Ford might try to buy off chunks of them :eek:

GM has the overall weakest lineup of the Former Big Three as well as the most pent up animosity among their customers. They had some product that was stronger (Cadillac, Corvettes) but that is all washed out by the seven other brands full of crap (Hummer, Saturn, SAAB, Chevrolet, Buick, Pontiac, GMC). Ford has fewer good products, but they have a greater percentage of good products since they don't have eighteen different versions of the same car under four badges. They're also starting to import and introduce truly world class product from their Euro division, which GM is still trying to decide if they really want to or not.

Also, I don't know who thought Ford was arrogant for not taking government money - I don't remember seeing any posts here or elsewhere to that effect.

*Crosses fingers*

Please buy Jeep from Chrysler!
Please buy Jeep from Chrysler!
Please buy Jeep from Chrysler!

They may be looking at the historical implications of that. Every company that has bought Jeep has died spectacularly or gotten into dire financial straits. First AMC, then Renault USA, then Chrysler... Jeep may be accursed. :p
 
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I thought it was a brilliant business move to turn down the government money. With that one decision I knew that I would look at Ford for my next car before any other brand.
 
I thought it was a brilliant business move to turn down the government money. With that one decision I knew that I would look at Ford for my next car before any other brand.

That and it means they won't be fucked by politicians who think they know how to run a car company.
 
Interesting as many thought Ford was pretty much being arrogant in not taking Gov money and now looks like the strongest of the 3.
It's probably the smartest business move they've made in the past ten years.
 
When I heard that ford had made consesstions with the UAW a while ago, I thought their stock would start to climb... who was right, I was.

Also, it's true that Jeep may be part of failing companies, but they have always been the profitable half of said companies.
 
They may be looking at the historical implications of that. Every company that has bought Jeep has died spectacularly or gotten into dire financial straits. First AMC, then Renault USA, then Chrysler... Jeep may be accursed. :p

And what other fantastic products did AMC offer in the late 1970s, or Renault in the 1980s, or Chrysler now? :p Jeep kept those companies afloat, making shitty cars longer because they were so profitable. :lol:
 
Euro Ford have made some fine products at decent prices with reasonable quality.

Personally if I were running Ford Europe the only weakness I can see is some of the dealer network, its a bit "old school" and not customer centric enough, I would put some effort in to fixing it.
 
I'm a ford man, I own some nice Ford stock(Personally atm I stand at 350 shares because I got 'em for like 1.50 apeice), and I am really happy to see my trust in the company at least seem to be well-placed. If I was to buy a new car within the next few years, it'd be the new Euro-American Focus or Fiesta (Or Mustang, if I could afford it).

I think their combination of lack of government money, with the UAW concessions and the reduction of debt really says something about Ford's management - I think they are doing a fantastic job given the current economic climate and are the most sound of the Big 3.
 
I saw a 2010 Fusion Hybrid at Target yesterday. I must say, I thought the new freshening of the Fusion looked decent in photos, but in person I was more impressed - the photos didn't do it justice.

Between that, a Taurus that people might actually want, new Fiesta, new F-150, freshened Mustang, not to mention the Flex and Edge - pretty much all of their products are brand new or only 1-2 years old. Its make or break time for them, and I think they have the pieces to come out of this thing a winner.
 
GM has the overall weakest lineup of the Former Big Three as well as the most pent up animosity among their customers. They had some product that was stronger (Cadillac, Corvettes) but that is all washed out by the seven other brands full of crap (Hummer, Saturn, SAAB, Chevrolet, Buick, Pontiac, GMC). Ford has fewer good products, but they have a greater percentage of good products since they don't have eighteen different versions of the same car under four badges. They're also starting to import and introduce truly world class product from their Euro division, which GM is still trying to decide if they really want to or not.

Also, I don't know who thought Ford was arrogant for not taking government money - I don't remember seeing any posts here or elsewhere to that effect.
:p

Makes sense, i guess GM good cars are very good (in my eye) and pretty much all Fords are just "meh" which is better then crap.

As for people thinking they where arrogant, i remember seeing people in the IRC Chan mention it, and on the radio. Dont know about the forums, but I would not put it past anyone.
 
Hmmm it's starting to look like I should consider hanging on to my wagon, as at least I'll be able to continue getting parts for it :p (I nearly picked up a caprice wagon the other day to sell off the ford).
 
Makes sense, i guess GM good cars are very good (in my eye) and pretty much all Fords are just "meh" which is better then crap.

And better than the embarrassments they used to be.

I think one of the real problems that GM has is that they have good products in the wrong places. World-class Cadillacs and Corvettes are nice, but you're not going to be able to sell hundreds of thousands of each of those models a year. Where they've dropped the ball is their normal models, like the Malibu and the Impala. The Impala is a sick joke and the Malibu, while a valiant effort, falls short of the mark and does not exceed the benchmark Camry in any significant way - plus has significant handicaps, like the lack of a nav system when the car was clearly designed to have one. (What idiot at GM thought that forcing your customers to *rent* a non-moving-map navigation service via OnStar was a GOOD idea?)

Contrast that with the Ford Fusion - it clearly beats the Camry in several metrics, doesn't have any Achilles' heels, and is obviously a serious contender in one of the most critical markets in the US - the family sedan. And you don't have to rent the nav system. Ford is laughing all the way to the bank with the Fusion; the new/restyled Fusion promises to be even better.

Hmmm it's starting to look like I should consider hanging on to my wagon, as at least I'll be able to continue getting parts for it :p (I nearly picked up a caprice wagon the other day to sell off the ford).

Weeelllll, I don't know about that, but seeing how the quality of GM parts has taken a steep decline for the worse lately (Series IIIs use GM ignition systems) to the point where you have to swap out GM dealer parts on a regular basis where you didn't have to as little as five years ago, yeah, Ford is probably a better bet on a consistent quality parts stream.
 
I remember when I told my friend a year ago or so that the new Impala's are front wheel drive, with v8.

He cried, understandably so.
 
Between that, a Taurus that people might actually want, new Fiesta, new F-150, freshened Mustang, not to mention the Flex and Edge - pretty much all of their products are brand new or only 1-2 years old. Its make or break time for them, and I think they have the pieces to come out of this thing a winner.

Only thing i don't get is how Ford could drop the only V6 from the F-150 lineup. Having only V8s as options sounds a bit short-sighted, especially as gas prices will go back through the roof once this crisis is over...
 
Only thing i don't get is how Ford could drop the only V6 from the F-150 lineup. Having only V8s as options sounds a bit short-sighted, especially as gas prices will go back through the roof once this crisis is over...

The 4.2 V6 doesn't meet the upcoming smog regulations, and it doesn't have enough of a fuel economy savings to justify keeping it and the 4.6L in the lineup (I think the difference is about 1mpg, if memory serves). The aged K?ln 4.0 from the Mustang and Explorer/Ranger doesn't have enough torque to justify putting it in, either.

That said, the disappearance of the six is only temporary, Ford is slated to introduce the all-new turbo six in the F-150 in the near future.
 
The 4.2 V6 doesn't meet the upcoming smog regulations, and it doesn't have enough of a fuel economy savings to justify keeping it and the 4.6L in the lineup (I think the difference is about 1mpg, if memory serves). The aged K?ln 4.0 from the Mustang and Explorer/Ranger doesn't have enough torque to justify putting it in, either.

That said, the disappearance of the six is only temporary, Ford is slated to introduce the all-new turbo six in the F-150 in the near future.

Thanks for clearing that up - now it makes perfect sense.
 
I think that replacing the stupid Ford Freestar minivan with the damn good looking Ford Flex was another bright idea on their part. Everytime I see it, I like it more and more. Even though its a rectangle just like the Scion xB, the proportions make it seem right and look good. Like gtrietsc said, pictures don't do the Flex justice.

Also, the new Taurus SHO...... Can't wait to see it in real life.
 
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