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Ford: bankruptcy "not an option"
The day after Standard & Poor's cut Ford Motor's debt rating deeper into the junk category, Bill Ford was quoted Thursday as saying that the company has no plans to seek bankruptcy protection, saying "it's not an option" in a Wall Street Journal interview.
S&P justified its latest ratings cut for Ford by saying that 2006 would be even tougher for the carmaker than anticipated, and we have to wonder if Ford still has a shot at making its "Way Forward" target of returning its North American operations to profitability by 2008.
Bill Ford admitted that the company's plans had not anticipated the magnitude of price increases in raw materials, or the rate of decline in SUV sales in the face of higher gas prices.
While rival General Motors' stock price has begun to recover as its restructuring program takes hold, Ford shareholders continue to head for the exits, fueling speculation that a possible strategy for the company could be to take itself private, although Bill Ford denies such a plan.
[Source: Reuters]
Reader Comments (Page 1 of 1)
sev4 pri1 5:44PM (6/29/2006)
"Bill Ford admitted that the company's plans had not anticipated ... the rate of decline in SUV sales in the face of higher gas prices."
And this guy is paid how much money?
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Fabulo 5:46PM (6/29/2006)
Until they actually file the paperwork under the court, they have no interest in toying with the idea publicly.
If there was a hint that it was even considered, or just talked about in executive meetings, supplyers would start to ask for money upfront, banks would want their money back, bonds would be worthless.
It would scare the shit out of everyone.
It's obvious that anytime they're gonna be asked, they're gonna deny it vehemently.
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richard elsbree 6:27PM (6/29/2006)
Something has to happen pretty soon at Ford as it is obvious that management
has no idea how to turn the company around. Catchy slogans just don't do it.
It's a shame to see this once-proud old name go away but it was started by a
man named Ford and will be destroyed by a man named Ford.
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Infinihertz 7:41PM (6/29/2006)
To address #1 - for the record, Bill Ford has forgone a salary until North America becomes profitable.
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GhostDoggy 10:55PM (6/29/2006)
How can the 'richest American automaker' be broke? Let Bill Ford run the company. :) Taurus anyone?
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Bob-o 12:08AM (6/30/2006)
So what cool Ford cars are going on sale soon?
I've been eyeing the 9-2X Aero from Saabaru (GMAC financing makes it a killer deal).
Hmm...maybe an RX-8?
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j panozzo 9:31AM (6/30/2006)
It is pretty obvious that Ford's "Way Forward" program is a step backward. Consider these points:
Ford is now deemphasizing fuel efficient hybrids and jumping on the gas guzzling E85 ethanol bandwagon. Make a lot of sense.
The best selling Ford vehicle currently is the Taurus, a model that is mainly marketed for fleet sales. So much for "Way Forward."
With gasoline well over three dollars a gallon, does it make sense to highly promote gas guzzing SUV's?
After everybody who wants the new age Mustang buys one, where does its long term future hold? Can you say New Beetle or PT Cruiser?
While the Fusion has gathered good reviews, so did the Tempo when it first came out.
Why is Ford talking about expanding its Mexican production when American workers desperately need jobs and Ford keeps closing American plants? Also, I'm sure the American auto workers union isn't too thrilled about that one.
Why continue to pump money into the ailing Lincoln-Mercury division? When will domestic rebadging end? A Lincoln Zephur/MKZ or whatever they want to call it today is nothing more than a rebadged Fusion which itself is a rebadged Mazda 6.
You see Ford needs to clean up its act. If you don't believe this, check out its stock price. That figure speaks for itself.
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Brian 10:14AM (6/30/2006)
I'm a bit bullish on Ford (and just recently decided to buy a chunk of stock). For the past 6 or 8 months, Ford car sales have been increasing, slowly chipping away at the SUV declines. June may well be the month where it turns around.
The Fusion is a good car and I'm seeing more and more on the road.
Just last night, I was at a cookout with a bunch of people and a new Mustang GT drove by. 3 or 4 of the people started talking about how great it sounded, how they want to drive one, how they'd like to have one, etc. These were people that never talked about cars before and grew up in a suburb where a Volvo station wagon is more at home than anything with a blue oval or a bowtie on it.
Ford is not going bankrupt, and they are going to be profitable, and I'm going to double my money on that stock within 36 months.
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Ian 12:03PM (6/30/2006)
Brian -
I wanted a mustang GT too! But a bought a subaru forester XT instead (just as fast). Your buddies won't buy a mustang either. I hope you have more than that to base your position on.
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CL2 12:23PM (6/30/2006)
It's ridiculous to compare the Fusion to the Tempo. The new Fusion is a great car and will only get better with the addition of the 3.5 engine. Face it, platform sharing is common throughout the industry and it makes economic sense. Anyone who says that only Ford (or only Americans) do it has their head up their you know what. And it's not just cars. What about stereos, TV's, kitchen appliances? I think they all platform share to a certain extent. I agree with #8. Ford's on their way back. Their only potential big mistake is possibly dropping the big RWD platform.
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Jim 11:24PM (6/30/2006)
So GM sells a few SUVs this quarter and all of a sudden its restructuring has "taken hold"? I don't think they've fixed the fundamental problems with the way the company is set up, but whatever.
And a Subaru forester is "just as fast" as a Mustang GT? Can you be serious? It has a 230hp boxer 4 and costs more. The WRX STI is a bit faster, but is $7500 more expensive. I'll take that $7500 and hit the performance parts bin.
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Lee 2:36PM (12/07/2006)
Ford did this to themselves. Forget the competitors. I own a 2006 Fusion. Nice on paper, horrible in execution. Tranny replaced already at 6k miles. AC developed a leak and I had to endure 100+ heat in the summer. Now the AC compressor clutch needs replacing. Plus the interior door handle chrome was peeling-3 days to order. Rear bumper was very loose. Clunk in suspension which is still present. Software update that helped the hesitation from idle a little. 2 door speakers replaced and I did not play my music loud.
Holy cow. Every time I see a Camry I bang myself in the head for trusting Ford. No more. 1 more year and this Fusion is gone.
Thanks for nothing Ford.
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