• Apr 19, 2010
General Motors, which hasn't been allowed to forget its recent financial propping up by all of us, is apparently still worth more than Ford Motor Company. That's a dubious fact that sticks in the craw of Detroit Free Press columnist Tom Walsh. Ford, you'll recall, preemptively mortgaged itself up to, and including its dental fillings to avoid the fate that befell GM and Chrysler. What's not computing for Walsh is that despite clearer financial leadership, Ford is still worth less according to the trading price of Motors Liquidation bonds, the entrails of old GM.
The whole thing is buried in a bunch of financial mumbo-jumbo, and the value of Motors Liquidation bonds are tied to bets on the success of a future initial public offering of the new GM. Sound excessively creative and possibly even irrationally exuberant? Despite having its most solid lineup in years and aggressively trimming brands, dealers, and liabilities, the General is clearly not out of the woods yet. Perhaps to market gamblers, GM is looking good right now, but there are plenty of hurdles to clear before its bailout is a true success.

In comparison, Ford is likely to post a profit this year, and GM will have to put up some good numbers for a few quarters to keep investors thinking that it's a worthwhile investment.

[Source: Detroit Free Press]


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  • 41 Comments
      • 4 Years Ago
      I think Ford may have something that GM and Chrysler Lost. RESPECT. I lost any respect for GM i ever had when they refused to file bankruptcy and took the second loan and also when they ditched Toyota with NUMMI financial obligations.
      • 4 Years Ago
      I have only been looking after my personal finances for approximately 15 years, and I know from watching friends and others...it doesn't matter how had you work at making your dollar, it's how dishonest you can be to multiply it. IMO Ford has the strongest product line-up of the 'domestic three'. I can only see myself driving a Corvette or a GMC Terrain out of the entire GM line-up.
        • 4 Years Ago
        Really, you'd spend your good money on a regrilled Edge or Fusion?
        • 4 Years Ago
        I don''t understand what the big hang-up is with the term "All New"... there really isn't an "all new" vehicle produced by any auto mfgr, they ALL use updated platforms year after year, it really makes no sense to re-invent the wheel and create anything all new... especially when you consider quality, its always better to update a "known" platform then invent an unknown from a quality perspective... get over it!!!

        Ford is getting smarter by doing more "updating" during mid-cycle refreshes to make their products look and feel newer... from Edge, Super Duty, Fusion, Mustang and its working... thats the great news!!! Just look at the "new" 2011 Mustang with new engines, 6-speed trans, updated handling (not an all new suspension, but it sure is better than the "old" one)... improved NVH and on...
        • 4 Years Ago
        Agree. Every new vehicle has a host of problems. Refreshes are what make the reliable vehicles and loyal customers.
        carguy
        • 4 Years Ago
        its not a re-grill, try all new front/rear facias, all new interior, drastic update to the I4 and V6 PT's, seating was updated, brand new technology (i.e. SYNC, Rear view camera, rear view sensors, navigation, 12 speaker Sony, ambient lighting, HID lighting), not bad for a mid-cycle refresh...
      • 4 Years Ago
      This is a worthless stat.

      Value of a corporation is; Assets-Liabilities/ number of outstanding shares... Or you can look at: shares x current market value (although this does not apply to GM because they are no longer traded publicly.

      GM has no outstanding shares... This is irrelevant.
      • 4 Years Ago
      As per their balance sheets Ford is worth Negative $8 Billion, as of December.
      http://finance.yahoo.com/q/bs?s=F&annual

      Optimists currently have Ford stock overvalued, but it is not horrible...

      When GM went bankrupt, it was losing money at a dramatic rate and worth Negative $91 Billion... but most of that debt was wiped out in bankrupcy
      http://finance.yahoo.com/q/bs?s=MTLQQ.PK

      For the Taxpayers to get their money back, GM will need to have higher market cap than they have ever had in the history of the company- realistically, that's not going to happen. However, from a business perspective, merely returning to company to profitability will be a major achievement, considering how bad the company was failing.

      • 4 Years Ago
      Ford looks better due to the plethora of product (in the last few years) for Ford and Lincoln brands. GM still has holes in each brand and it gets pointed out, whereas the ignored Mercury line rarely is brought up. Plus, Ford is reporting profits, but GM shows losses due to their accounting write-offs. Once GM stops the 1-timers they may show big profits for their product sales.
        • 4 Years Ago
        The 'tweak' model can work well, though. Upgrade an engine, modify the interior a little, or even some fascia work and a dated model looks fresh. Ford was wise to do it, since it gave them breathing room and lower expenses, while not hurting sales. GM refreshed little for the last 2 years, and now the 'fresh in 2008' Malibu is derided as way out of date. (let's not even get into the Impala). But if they had changed the interior a little, upgraded the handling, or even altered the taillights or front end a little then that may have changed. And none of that really changes the base tooling expenses.
        • 4 Years Ago
        Most of that plethora is actually old product that recieved tweaks, F150, Mustang, Fusion, the current Focus etc, are all still the old vehicles Ford released years ago but they market them as "new" with a little restyle here and a little boost there. It's rarely reported that way in the media though. The Fiesta and upcoming Focus are entirely new however. You make due when you have that much money you owe. It reminds me a bit of AMC's last ten years or so of continually refreshing old product to keep it relevant.
        • 4 Years Ago
        I also find it weird Ford can call the Super Duty the "all new Super Duty". It's not all new. But they got away with it on the Mustang when it was reskinned (twice, IIRC).

        I'm not saying no one else does this, more saying I find it strange anyone gets away with it. All new should mean all new, or heck, at least 80% new.
        • 4 Years Ago
        Ford's always done that. They have an 'all new design', then a revision 2.0 of the design. Works well enough for them.
      • 4 Years Ago
      This is a pretty silly article anyways. They're comparing the future projection of GM's worth vs Ford's current market worth. And obviously, that's a huge grey area.

      Even so, GM cleared a ton of debt with Ch11 filing, while Ford is still hanging onto theirs.
      • 4 Years Ago
      Ford/Lincoln has better music in their commercials so they are clearly doing better

      but seriously i think most of us like Ford more than GM because they 1. didnt take bailout money and 2. are puting out some great products

      ...how about a poll AB???? FOR or GM? do it! Do it!
      • 4 Years Ago
      Exactly, Ford is still in the woods with GM and Chrysler. They look better relative to their crosstown rivals, but Ford is still in deep shizzle - to the tune of 34 billion. They also still depend on the same level of fleet sales as GM. They still have the dead brand problem of GM as well. GM and Ford can make it out of the woods, it's a much longer shot for Chrysler.
      • 4 Years Ago
      Because we(the taxpayers) gave them all our money
        • 4 Years Ago
        And it seems like GM has more potential with the vehicle lines & brands it already has. On the flip, Ford continues to introduce more SUVs into its lineup --- while GM (and eventually Chrys) have been working on their smaller vehicles.

        Though GM still sells its GMT900 SUVs & trucks, they have been vastly revamped (w/more plans for the next-gen redesigns) --- in contrast, how many people were sad that the Excursion went out of production? Ford's large trucks and SUVs aren't all that great-looking when their ownership costs seems to suggest otherwise.

        GM is still trying to compete against everybody, while Ford seems to be only focused on the NA market.
        • 4 Years Ago
        And if GM survives we'll get it all back plus interest.

        Of course, that would be terrible for you wouldn't it...successful government intervention that is. Nothing worse than something you are philosophically opposed to actually succeeding.
        • 4 Years Ago
        No. It's a very simple concept actually: GM and Chrysler wiped most of their debt with Chapter 11, Ford didn't. As Dan so eloquently put, "Ford preemptively mortgaged itself up to, and including its dental fillings to avoid the fate that befell GM and Chrysler."

        They are far from being out of the woods.
        • 4 Years Ago
        Hey, I said it, "seems like" b/c I really don't know. Corporate valuations & stock values aren't (truthfully) based on actual/real performances or loads of debt. It's all speculation. That's why GM seems to be a much better bet than Ford at this moment. I'd rather bet on the company that didn't mortgage away all of it's brands to raise pennies.

        Ford has a large amount of SUVs (which includes all the crossovers SUVs and CUVs --- whatever you want to call them): Edge, Flex, Escape, EscapeHybrid, Explorer, ExplorerSportTrac, & Expedition. A lot.
        • 4 Years Ago
        Ford is loaded down with senior debt--obligations that will be paid before shareholders get paid. GM cleaned itself of debt thru bankruptcy.
        • 4 Years Ago
        Jei, you must be confusing Ford with some other brand. Ford's latest projects have been new Focus, Fiesta, Fusion Hybrid, Taurus and all the vehicles those platforms underpin. The only SUVs in their line up are the Explorer and Expedition. The Explorer goes unibody, effectively becoming a CUV (of which Ford has two: Edge & Flex). Arguable the most effort by Ford has been on the Fiesta and Focus; i.e. smaller vehicles.

        The Excursion went out of production in 2005, long before the automotive melt-down. Fords trucks have been best sellers for decades, its unlikely they would pull that off if they had abnormally high ownership costs.

        Your final claim that "GM is still trying to compete against everybody, while Ford seems to be only focused on the NA market." might be the most laughable. Ford has been very vocal that they are going to a global platform where all cars are sold all markets and are all identifiable as a Ford. Not to mention Ford is the number one or number two auto manufacturer in Europe.

        I get that you don't like Ford but c'mon, you are talking to a bunch of gearheads and auto enthusiast, we can see through the fanboy BS.
        • 4 Years Ago
        @ Poopy : I see how it works now. Obama is a socialist because the Bush administration bailed out GM. Right? Did you and your little brain ever make it to a critical thinking class in college?
        • 4 Years Ago
        Ford is finally turning itself around thanks to Ford Europe. I cant say the same for GM, I havent seen anything interesting in their future lineup, they still dont get it. The Malibu is a decent sedan but it just fades into traffic because of its generic styling, I could pass a dozen on the way home and I wouldnt even notice.

        The new Fiesta and Focus will stand out on the road and should do quite well for Ford while building brand awareness. They still have a ways to go though, for instance not doing the Focus RS here or any other compact sports car is quite stupid. They are slowly but surely fighting the thinking that put them into mediocrity.
      • 4 Years Ago
      Ford needs to fix their Mercury and Lincoln problems first.
        • 4 Years Ago
        Ford needs to drop Mercury and then make Lincoln more of a stand out brand (i.e., powertrains you can't get in a Ford)
        • 4 Years Ago
        And "fixing" Lincoln / Mercury means more than a new grille & badge!

        Seriously, someone at Ford oughta articulate what Lincoln and Mercury are besides leather interiors. Are they both Lexus fighters? Or is one a Lexus fighter and the other an Acura fighter? What?
        • 4 Years Ago
        I think Mercury's fate was confirmed when they said there wouldn't be a new Sable. Mercury definitely needs to go, and Lincoln needs to more a little more upmarket.
        • 4 Years Ago
        Agreed, Cadillac blows Lincoln out of the water if you ask me.
        • 4 Years Ago
        @Luis

        Don't you have some other forum you can troll at? Like maybe IOnlyDigRicers.Com or something? Sheesh. Get a life.
        • 4 Years Ago
        Mercury is only sold in the US. Not even Canada! It's hard to imagine how the brand could be any more marginal. Yeah, they do have some decent products right now, but frankly I think those could be slid over to Lincoln too and Ford could send Mercury off into the sunset to the better.
        • 4 Years Ago
        and their crappy Ford interiors. They all suck!
      • 4 Years Ago
      I've been working at a Ford collision center for 4 years. (call me biased all you like) I've been a Toyota fan boy up till 2 years ago... Fords product up till that point left lots to be desired. Ford from my view point has come from the bottom of the barrel, to class leading on most fronts in a very short period. I beileve honor should be given were its due, and Fords due alot! Ford keep up the good work!!!
      • 4 Years Ago
      People should be careful about making comments without knowing the facts. The comment that Ford is only concentrating on NA is very incorrect. In fact, Ford outsold VW in Europe last month (albeit with help from UK's cash for clunckers). In fact, Eurpeans have enjoyed much better Ford models in the past. That is about to soon change.
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