Ford posts $2.3B profit for Q2, $424M operating loss

[MuscleCarz]

http://www.autoblog.com/2009/07/23/f...loss/#comments

Ford Motor Company is continuing to reverse its fortunes despite the globe's bleak auto markets, as the Dearborn, MI based-automaker surprised analysts with a $2.3 billion profit in the second quarter. Ford isn't dancing in the streets just yet, though, as it is still reporting $424 million in overall operating losses for the quarter. The $2.3 billion profit comes courtesy debt reduction activities taken on during the quarter, as Ford reduced its debt load by $10 billion as part of a debt-for-equity exchange, and a further $1.5 billion was raised in a stock sale. Ford says the $10 billion equity swap alone saved the company $500 million in interest expenses.

While the Blue Oval has a long way to go to get to where it wants to be, comparing numbers from the same quarter last year shows how far the automaker has come. Ford posted an $8.7 billion loss in Q2 2008, while posting a $1.4 billion operations loss.

Analysts were expecting an improvement for 2009, but the target was a 53 cent per share loss, and Ford shattered that with a loss of only 21 cents per share. Importantly, Ford has dramatically improved its cash situation too, as the company burned through only $300 million in cash. That's a huge improvement when compared to the $3.7 billion greenbacks Ford scorched in Q1. Mullaly and Co. now has $21 billion in cash on hand, down from $21.3 billion after Q1.

Ford also had good news on the production front, as its market share increased in a historically bad market. Ford increased share the right way, too, as it managed to do so despite decreasing incentive spend by $250 per vehicle compared to Q1. Ford CEO Alan Mulally sounds pretty optimistic about the company's prospects, with Q2 numbers bolstering its position.

[Dakota Kid]

Ford has a nice lineup these days.

[Unfair]

They should give GM some tips or hire a ford consultant or something jesssus

[Zabo]

Originally Posted by Unfair

They should give GM some tips or hire a ford consultant or something jesssus

Really..? I mean, really?

Yeah.. C'mon GM.

[Legend]

Well with the GM and Chrylser in BK...most people bought Fords if they were looking for cars...I mean the average American will make decisions based on what the media tells them...so they bought Fords since they were the only one not in BK!

It's sad there are so many people like that...but it's true.

Good for Ford though...maybe the start of all three coming back strong!

[Supermans]

Originally Posted by Unfair

They should give GM some tips or hire a ford consultant or something jesssus

Over time, it will become apparent to the general public that there is a difference between a privately run business and a Government run entity when it comes to becoming more efficient and generating a profit. It is good that at least one privately run American car company still exists that is making wise decisions on its own without massive Government intervention.

Originally Posted by I am Legend

Well with the GM and Chrylser in BK...most people bought Fords if they were looking for cars...I mean the average American will make decisions based on what the media tells them...so they bought Fords since they were the only one not in BK!

It's sad there are so many people like that...but it's true.

Good for Ford though...maybe the start of all three coming back strong!

The media is constantly lambasting privately run business including Ford and has run many puff pieces on the new GM and how "green" they will become now that they shed some heavy gas guzzling weight.. I don't think the media has as much clout in affecting peoples decisions when they need to go out and buy a car. Advertising does make a huge difference though and Ford commercials do seem to run at a 4:1 margin when compared to GM. Toyota, Nissan and Mazda all have plenty of commercials. I rarely see any GM or Chrysler commercials anymore and in my opinion they really need to increase those to raise sales..

[camaro5]

Originally Posted by MuscleCarz

http://www.autoblog.com/2009/07/23/f...loss/#comments

This is great news for the American auto industry.

Originally Posted by Supermans

Over time, it will become apparent to the general public that there is a difference between a privately run business and a Government run entity when it comes to becoming more efficient and generating a profit. It is good that at least one privately run American car company still exists that is making wise decisions on its own without massive Government intervention.



The media is constantly lambasting privately run business including Ford and has run many puff pieces on the new GM and how "green" they will become now that they shed some heavy gas guzzling weight.. I don't think the media has as much clout in affecting peoples decisions when they need to go out and buy a car. Advertising does make a huge difference though and Ford commercials do seem to run at a 4:1 margin when compared to GM. Toyota, Nissan and Mazda all have plenty of commercials. I rarely see any GM or Chrysler commercials anymore and in my opinion they really need to increase those to raise sales..

Don't forget, GM is dead.

The NEW GM has none of the debt and legacy costs, they dumped them all through bankruptcy.

I believe we will see a profitable NEW GM when the current quarters results are revealed.

Also, if the government did not step in, we'd all be forced to buy Mustangs; GM would be complete history.

[DGthe3]

Originally Posted by Supermans

Over time, it will become apparent to the general public that there is a difference between a privately run business and a Government run entity when it comes to becoming more efficient and generating a profit. It is good that at least one privately run American car company still exists that is making wise decisions on its own without massive Government intervention.

Show me where GM is being run by the government. Show me anyone who makes a decision at GM who is directly responsible to the US, Canadian, or Ontario government. Last time I checked, those 3 governments had 0 voting shares. Here is a quote from Obama himself "When a difficult decision has to be made on matters like where to open a new plant or what type of new car to make, the new GM, not the United States government, will make that decision", that was on June 1st.

Owners are not always the operators. Everyone seems to agree that it is incredibly stupid to have the government run GM. This includes the people in the government and at GM. Why? Well, it would likely cause the company to eventually cease operations and be erased from landscape. Nobody involved wants that to happen because if they did, it would have happened already.

[Georgie]

ownership give you the right to vote for directors and the residual profit interest, plus dividends if declared. the big thing is that if the government has a majority share (not sure that is the case here) they can vote in the top management they want and run the company via their selected directors. if they have no share then they can't do much in terms of voting in directors.

[syr74]

Originally Posted by camaro5

The NEW GM has none of the debt and legacy costs, they dumped them all through bankruptcy.

I believe we will see a profitable NEW GM when the current quarters results are revealed.

Also, if the government did not step in, we'd all be forced to buy Mustangs; GM would be complete history.

The new GM started life 10 billion dollars in debt.

[Xmicro_SS]

They were smart to downsize and resell all the foreign automakers they bought early on in the down turn. I wonder if they just bought them to steal some secrets, because their cars improved a lot since they owned, Volvo, Jag, Aston Martin, etc.

[MuscleCarz]

Originally Posted by syr74

The new GM started life 10 billion dollars in debt.

Plus the $50b they owe the gov.