Ford Posts Loss of $5.8 Billion, Worst Since '92

SnoMan wrote:
>
> I think Ford (and GM and Chysler) is in a lot worse shape than they
> admit. They only chance any of them have to survive is to get labor
> cost way down and improve quality. It will never happen in current
> structuring. They are kidding themselve (managemtn and Labor) if they
> think they can pull it off otherwise. Prices have reached critical
> mass and can no longer sell to support current costs and benifits. If
> they all could cut labor costs 30% or more they could sell vehicle 15%
> cheaper across the board and make a profit and boost sales but they
> seem to keep hoping that people will except pay more for their car
> than some did for a house 20 years ago. The worst is yet to come for
> them.
> -----------------
> TheSnoMan.com

The real culprit in all this is over-regulation by the federal
government. All of the "safety" and "emissions" regs the automakers
have to put up with are driving the cost of vehicles beyond the point
where someone making an average salary can't afford one. I was just
reading today that the average US family income is $34,500. The
average cost of a new car is up around $22,000. By that token a new
car costs 2/3 of income. And a lot of the cost is all this safety and
emissions equipment. And the feds keep piling it on. I heard
somewhere that in the 2010 model year all cars are required to be
drive-by-wire with electronic stability control. By the time the feds
are done regulating only CEO's and Senators will be able to afford a
new car!

Mark

On Wed, 25 Oct 2006 07:46:35 -0500,
(Brent P) wrote:

>In article .com>, duty-honor-country wrote:
>
>> GM makes the best domestic cars, always have, always will.
>
>Um no. And if that's the way you feel, why are you in Ford NG's?
>
>> That's why GM has been the biggest car co. in the world- FOR DECADES.
>
>Biggest doesn't mean best. GM makes a lot of crap and has done so FOR
>DECADES. It's size means that they have gotten away with it FOR DECADES. <snip>

Exactly...GM is now paying for screwing customers since the late
1960s.

To evade stupid, useless crap posts like the one you just dealt with,
global kill file the following:






....and the problem will go away.

The "problem" is Charles M. Nudo, Jr. of Drums, PA...the "Jelly Jar
King of Drums," as he's known by, a paranoid delusional nut case who
likes to make his own reality as he goes along. This nutbag has had
no less than 14 (soon to be more) Google Groups accounts shut down for
spam, harassment, posting of personal information, and other miscues.
There is NO reasoning with this ****tard....just kill file him. He's
too stupid to use a newsreader, so he thinks that by "bumping" posts
he'll remain on top of the thread list. Little does he realize that
only works in Google, which no one with a brain uses.

>True... Which is why it takes an interesting car at a good price to get me
>considering buying a new car. Another issue is the dealerships. No matter
>how good the new product is, just going in there is an unpleasant
>experience. <snip>

GM itself proved this with the Saturn project. When people found out
that non-commissioned sales people would be simply filling orders for
new cars, Saturn took off like a Saturn rocket. However, GM, always
looking to screw people, started allowing their Saturn dealers to
start doing "workarounds" to the non-commissioned sales rule, tacking
on huge "spiffs" onto things like finanacing, insurance and dealer
"add-ons." Now, most Saturn dealers are just as bad as the rest of
them, and falling Saturn sales tell the tale.

Ford, over the years, has had some of the worst dealers of all, both
for sales abuse and service. "Fence jobs" in Ford service departments
were the rule...take the car in, decide the customer's a dumb ****,
park the car along the back fence for about a week, call the customer
for pick-up, charge them $500 for transmission work, "tune up",
whatever. They tried to "fence job" me on a new '70 Ford with a 3-2
part throttle downshift flare, and I caught them. Ford's zone office
paid me for my trouble and made the dealer pay an independent shop for
a new intermediate band servo seal job.

To be fair, I caught a Toyota dealership doing this with '70s Toyotas
with B-W automatics. They'd take the cars in, tell the owner that the
transmission was "shot," "fence line" it, then deliver the car in a
week with not a wrench being put to it. A seal placed on the
transmission pan told the tale. Toyota refused to revoke the dealer's
franchise, and that was back years ago, but the state threatened to
take away their license unless full refunds were paid out.

On Wed, 25 Oct 2006 08:21:45 GMT, Some O > wrote:

>In article >,
> "Grover C. McCoury III" > wrote:
>
>> Indeed, the new chief executive at Ford, Alan R. Mulally, a former Boeing
>> executive, said the automaker would require a full transformation in the way
>> it thought about consumers and approached the American market.
>
>Well at least he recognizes Ford has a consumer related problem.
>That's a good start. <snip>

After Billy Boy Ford's mismanagement, he has a LOT of clean-up work to
do, probably as much or more than Iacocca did when he started to turn
Chrysler around in the '70s. Billy Boy thought that people would come
in droves to buy things like F-150/250s, Expeditions and Lincoln
pickups, while neglecting and not fixing problems with the Focus
project, following King Henry II's dictum of "mini cars, mini
profits," and banking the whole company's "car" future on the 500
project, which is turning out to be a turd, as is the Tempo-esque
"Fusion." The "retro" Mustang has a limited market at best, and their
callous marketing ploys (you can only get upgraded interior and
appearance packages like the GT with a V8, silly in that sized car)
have dampened a lot of sales.

The challenge to Mulally will be to put Ford's money where their mouth
is on the fuel cell project. If they can crack that nut, the Japs,
finally, will be in big trouble. It will require regime change in
Washington (part of which will happen in about 10 days) and rejetion
of many Ford family paradigms. The Ford family, like everyone in
power at GM, is too tied to the oil industry to be useful in
converting the country away from petroleum-based fuel. For a
turnaround to work, the Ford family MUST be removed from company
operations, once and for all time.

The Ford family will NOT try to take the company private again.
They're not THAT stupid. Doing so would rather be like Cunard
launching a new "Titanic II" in 1913. The running away of Billy Boy
pretty much showed the family's hand...rats running from a sinking
ship.

Oh...before you decide to go for that V8 Mustang or F-150 gas guzzler,
oil spot market prices are back on the rise again, over $60/bbl and
rising as I write this. Looks like the Saudis aren't waiting for the
election!

In article >, DeserTBoB wrote:

> "Fusion." The "retro" Mustang has a limited market at best, and their
> callous marketing ploys (you can only get upgraded interior and
> appearance packages like the GT with a V8, silly in that sized car)
> have dampened a lot of sales.

Ford's marketing tends to turn everything they touch bad if it wasn't
already a bad idea from the get go.

> The Ford family, like everyone in
> power at GM, is too tied to the oil industry to be useful in
> converting the country away from petroleum-based fuel.

The problem is not using petroleum-based fuel, as there is enough oil in
the americas alone to keep using gasoline. The problem is that oil isn't
a free market. Huge barriers to entry from infastructure to regulation to
politics allow big oil to do as they please. That's where a
non-petroleum-based fuel comes into play, to turn the fuel business back
to something more like a free market. Exactly what large corporations do
not want. They want the market fixed in their favor as much as possible.

> Oh...before you decide to go for that V8 Mustang or F-150 gas guzzler,
> oil spot market prices are back on the rise again, over $60/bbl and
> rising as I write this. Looks like the Saudis aren't waiting for the
> election!

Actually I am not going to make my next purchase based on fuel economy.
I'd rather have a car I'll enjoy and use my bicycle (which I also enjoy)
to compensate for any shortage in fuel economy. Now what would have been
nice is to have had something come of the super-stallion project.

"duty-honor-country" > wrote in message
ups.com...
>
> Jeff wrote:
>> "duty-honor-country" > wrote in message
>> ups.com...
>> >
>> <copyrighted material deleted>
>>
>> > corporate losses are merely written off at tax time- the fed, state,
>> > local governments end up giving the corp. about a 50% or more tax break
>>
>> Really? That means they still lose 50% or so. Pretty big.
>>
>> > due to the loss- and "billions" to Ford is like a nickel in our
>> > pockets- it's nothing
>>
>> Really? Ford had total assests of about $50 billion on Dec. 31. So that
>> is
>> like losing 10% of your total assets. Imagine if you had $50,000 and lost
>> $5000. It is far from nothing.
>>
>> > Ford owns several overseas car companies- and they aren't all doing
>> > bad- some major names like LAND ROVER- MAZDA- JAGUAR-VOLVO- ASTON
>> > MARTIN- etc.
>>
>> And they are trying to sell some. Mazda is not wholly owned by Ford. And
>> there is no etc. THat is all the car companies they own.
>>
>> > take a look for yourself- they are still the #3 carmaker in the world
>> >
>> > http://en.wikipedia.org/wiki/List_of...y_Manufacturer
>> >
>> > laying people off just means they will make more money next year- less
>> > paychecks to send out
>>
>> Well, maybe they will start making money 3 or 4 years out.
>>
>> > they've had loss years before- no biggie
>>
>> And if they don't make big changes now, they will have more loss years.
>>
>> > here is their world holdings
>> >
>> > 3. Ford Motor Company (United States) - 6,418,416 vehicles
>> > Aston Martin United Kingdom Subsidiary Luxury / Performance Global
>> > Ford Motor Company United States Division Mainstream Global
>> > Jaguar United Kingdom Subsidiary Luxury Europe/North America
>> > Land Rover United Kingdom Subsidiary Luxury Truck Global
>> > Lincoln United States Division Luxury North America
>> > Mercury United States Division Near-Luxury North America
>> > Volvo Cars Sweden Subsidiary Near-Luxury
>> > Mazda
>> >
>> > doesn't mean they are going out of business any time soon
>>
>> But they are doing poorly. If they don't change, they won't be in
>> business.
>>
>> Jeff
>
>
> you're mistaken there, and I disagree- here's why
>
> they posted a $5.8 billion loss- that means they can WRITE IT OFF

Show me that they can "write it off." Sure, their taxes will go down. But,
they don't have an unlimited supply of cash.

> in that so-called "loss", is a lot of accounting tricks, i.e.
> DEPRECIATION.

Actually, there was a negative cash flow of $3,000,000,000 at the end of the
quarter, meaning the company spent $3,000,000,000 than it took in.

> what you really need to see, is their STATEMENT OF CASH FLOW
>
> it's possible to show a loss on the P&L statement, and actually have a
> POSITIVE cash flow
>
> i.e. an ACCOUNTING LOSS, that can be written off over time
>
> now, being they showed this alleged "loss" of $5.8 bill, that is 5.8
> bill in PROFITS they don't have to pay TAXES on
>
> corporations pay taxes at an extraordinary percentage- like 40% or
> more.
>
> so basically, if they made a 5.8 bill PROFIT they'd owe Uncle Sam 40%
> of it anyway, or around 2.3 billion
>
> the government basically "picks up" a piece of that "loss", with
> reduced tax revenue
>
> in the meantime, Ford lays off thousands of people, which is less cash
> they send out
>
> the cash flow IMPROVES even more
>
> so it's not really a loss- it's an accounting trick
>
> do you REALLY THINK that Jaguar, Volvo, Mazda- all owned by Ford- lost
> money ??

No. But they don't make up for Ford's othter losses.

> your sarcasm shows you don't know diddley squat about corp.
> accounting...

Actually, I don't know everything. But I know that if you have a minus
$3,000,000,000 cash flow each quarter for a few years, you will not have a
company.

I also know that the market cap of Ford is about $15B, less than the cash it
has in the bank. That should tell you something about the underlying value
of the company.

Jeff

> nuff said...
>

"ZombyWoof" > wrote in message
...
> On 25 Oct 2006 04:45:22 -0700, "duty-honor-country"
> > wrote something wonderfully witty:
> <snip>
>>
>>you're mistaken there, and I disagree- here's why
>>
>>they posted a $5.8 billion loss- that means they can WRITE IT OFF
>>
>>in that so-called "loss", is a lot of accounting tricks, i.e.
>>DEPRECIATION.
>>
>>what you really need to see, is their STATEMENT OF CASH FLOW
>>
>>it's possible to show a loss on the P&L statement, and actually have a
>>POSITIVE cash flow
>>
>>i.e. an ACCOUNTING LOSS, that can be written off over time
>>
>>now, being they showed this alleged "loss" of $5.8 bill, that is 5.8
>>bill in PROFITS they don't have to pay TAXES on
>>
>>corporations pay taxes at an extraordinary percentage- like 40% or
>>more.
>>
>>so basically, if they made a 5.8 bill PROFIT they'd owe Uncle Sam 40%
>>of it anyway, or around 2.3 billion
>>
>>the government basically "picks up" a piece of that "loss", with
>>reduced tax revenue
>>
>>in the meantime, Ford lays off thousands of people, which is less cash
>>they send out
>>
>>the cash flow IMPROVES even more
>>
>>so it's not really a loss- it's an accounting trick
>>
>>do you REALLY THINK that Jaguar, Volvo, Mazda- all owned by Ford- lost
>>money ??
>>
>>your sarcasm shows you don't know diddley squat about corp.
>>accounting...
>>
>>nuff said...
>>
> While all true, and even more so since corporations never really pay
> taxes only collect them from me & you to pass them on to the
> government anyway the entire thing is eyewash anyways. Many people
> just don't understand this. When a company, any company, sets a price
> on a product the tax liability of the profit is factored in yielding a
> net profit after tax. The tax bite is already calculated and it is on
> the consumer end. The consumer is always the one who is ultimately
> paying the tax.
>
> What is hurting Ford is the layoff & early retirement packages they
> are having to give to people at some of the plants they are closing.
> This is upfront cash in todays dollars. At my local plant here in
> Norfolk Va workers will be seeing a $100,000 or 140,000 pre-tax cash
> payout depending on years service if not eligible to retire and do not
> move to another plant. They are estimating around 1800 people are
> going to take that buyout. That's hundreds of millions to cough up
> sometime in `07 at just one plant. How many are they closing?

Plus the health care costs for employees and retirees and pension costs for
retirees. It is eastimated that over $1000 per car sold goes to pay for
these.

> That amount of money along with rebates & slow sales hurt at the cash
> register. Not to mention losing on currency conversion with the Euro
> whopping the dollars ass on the global exchange rate.

Actually, the currency conversion doesn't matter that much, because Ford
cars sold in the US are not made in Europe. However, any profits in Europe
would actually increase, because of the rate.

Jeff

> --
>
> You can run, but you'll only die tired.
>
> ZombyWoof

"ZombyWoof" > wrote in message
...
> On Wed, 25 Oct 2006 04:32:29 GMT, SnoMan > wrote
> something wonderfully witty:
>
>>On Tue, 24 Oct 2006 23:46:30 -0400, "Roy" > wrote:
>>
>>>You friggin idiot! How about you take a 30% pay cut and donate it to the
>>>big
>>>3. Your pretty free with everybody else's money, put your's where your
>>>big
>>>mouth is!
>>
>>
>>Oh the real idiot speaks! You really are clueless but as usual shoot
>>you mouth off about thing you hane no real understanding of. Currently
>>70% of the cost of building a new car is LABOR!!!!! The market will
>>not longer support it plan and simple. The big three will go under if
>>this is not changed as the writing in on the wall. The airlines have
>>been going through this for years and do not make what they once did.
>>You are free to beilve othersie but wishing do not make it happen. It
>>is going to basicall come down to in the next 3 to 5 years tops that
>>there will either be big waage concessions or they will be out of a
>>Job because the Big 3 will go bankrupt. The pot is not limitless and
>>it is getting empty fast and higher fuel prices will be here soon two
>>with $4 a gallon fuel not far away one day and Detriot is still stuck
>>on gas hogs that they have to beg people to buy. I bet you beleive
>>that we can grow our way out of this in the field with ethanol too.
>>The only problem with tis is if all of the corn was used (leaving none
>>for food at all) it would only replace about 25 to 30% of the gas used
>>daily tops but since we have to eat too it will not make that big of
>>impact. Detriot has their head in the sand and just keeps build the
>>gas hogs that will soon have gas payments bigger than car payments.
>>They only way they can survive long term is to get costs down and
>>lower price of product to offset higher fuel costs or go out of
>>bussiness. Sure you can blame Toyota and Honda but Detriot gave the
>>market to them with their limited vision and there fixation with high
>>profit SUVs since mid 90's that paid labors bills but are not longer
>>bringing in profit because they are not selling without big discounts
>>and incentives but you would know this too if you knew math and
>>ecomonics.
>>-----------------
>>
> The issue with the automakers & the airlines is a different economic
> model. The don't have to run an entire plant just to make one run of
> cars, but they do have to run a flight if it isn't fully booked. The
> Airline business is very capital (fixed asset) intensive. The
> variable costs per passenger is pretty small.

Yet, it costs a lot to design a vehicle and retool a auto plant.

Plus, both airlines and car makers had a lot of overhead costs with pensions
and health care.

> When auto sales slow down they can idle a plant, cut back shifts,
> layoff workers. When planes are flying at less then capacity its a
> bitch.

They can cut back the number of planes that they fly or fly smaller planes
(or atternatively, other airlines can fly smaller planes).

> However, I agree with you that something has to be done to control the
> escalating labor costs facing domestic automakers. Hyundai must be
> making a small fortune on its vehicles because I know they don't pay
> their workers at the same level as us. I personally haven't seen that
> big of a price differential between their cars and domestically
> produced Big 3 ones. Perhaps I'm missing something.
>
> --
>
> You can run, but you'll only die tired.
>
> ZombyWoof

Don't you think it was an improvement?
Bob
"aarcuda69062" > wrote in message
...
> In article >,
> SnoMan > wrote:
>
>> On Tue, 24 Oct 2006 23:46:30 -0400, "Roy" > wrote:
>>
>> >You friggin idiot! How about you take a 30% pay cut and donate it to the
>> >big
>> >3. Your pretty free with everybody else's money, put your's where your
>> >big
>> >mouth is!
>>
>>
>> Oh the real idiot speaks!
>
> What made you decide to move your signature to the top of your
> posts?

"Nemisis" > wrote in message
oups.com...
>
> SnoMan wrote:
>>
>> I think Ford (and GM and Chysler) is in a lot worse shape than they
>> admit. They only chance any of them have to survive is to get labor
>> cost way down and improve quality. It will never happen in current
>> structuring. They are kidding themselve (managemtn and Labor) if they
>> think they can pull it off otherwise. Prices have reached critical
>> mass and can no longer sell to support current costs and benifits. If
>> they all could cut labor costs 30% or more they could sell vehicle 15%
>> cheaper across the board and make a profit and boost sales but they
>> seem to keep hoping that people will except pay more for their car
>> than some did for a house 20 years ago. The worst is yet to come for
>> them.
>> -----------------
>> TheSnoMan.com
>
> The real culprit in all this is over-regulation by the federal
> government. All of the "safety" and "emissions" regs the automakers
> have to put up with are driving the cost of vehicles beyond the point
> where someone making an average salary can't afford one.

Really? I see what you mean. There are fewer and fewer cars on the road and
fewer and fewer cars sold every year. Families have fewer cars than ever
before.</sarcasm>

In real life, more often, there are families with more cars than drivers.

Actually, adjusting for inflation, is the cost of a car more or less than it
was say 30 years ago? Actually, about 0.2% more for domestic cars. Then,
also adjust for the fact that cars last longer no than 30 years ago. So the
price of a car has actually been falling when adjusting for inflation,
decreased maintaince and increased life-span.

> I was just
> reading today that the average US family income is $34,500. The
> average cost of a new car is up around $22,000. By that token a new
> car costs 2/3 of income. And a lot of the cost is all this safety and
> emissions equipment. And the feds keep piling it on.

You can always by a used car without airbags, antilock brakes or other
safety equipment.

> I heard
> somewhere that in the 2010 model year all cars are required to be
> drive-by-wire with electronic stability control. By the time the feds
> are done regulating only CEO's and Senators will be able to afford a
> new car!

Requiring drive by wire in 2 1/2 years? Are you nuts? No one does than now.
It will take more than 2 1/2 years to bring that on. It might be that some
cars will be drive by wire, but not more than a few.

Jeff



> Mark
>

"duty-honor-country" > wrote in message
ups.com...
>
> SnoMan wrote:
>> On Tue, 24 Oct 2006 23:18:12 GMT, "Whitelightning"
>> > wrote:
>>
>> >
>> >"DeserTBoB" > wrote in message
>> .. .
>> >> On Tue, 24 Oct 2006 08:28:47 -0400, "Grover C. McCoury III"
>> >> > wrote:
>> >>
>> >> >"This is an important industry" and Ford has so much opportunity for
>> >improvement, he added. <snip>
>> >>
>> >> First "improvement" Mulally has to accomplish is to clean up Billy Boy
>> >> Ford's doo doo messes. We will never see another Ford family scion at
>> >> the top of this company. After the disasters of King Henry II and the
>> >> latest dingbat, the Ford Family Duchy is finally gone.
>> >>
>> >> >Asked whether he felt pressure from the expectations being placed on
>> >> >his
>> >performance, Mr. Mulally replied, "There's no reason why we can't do
>> >this,
>> >so it's no pressure." <snip>
>> >>
>> >> Ask him again in six months.
>> >
>> >Don't bet anything but wooden nickels on that line of thinking.
>> >My opinion, and that's all it is, is my opinion, is that the Ford family
>> >wants to take the company private, drive the stock down and its cheaper
>> >to
>> >do.
>> >The worst thing for a company is board of directors and a ton of share
>> >holders more interested in short term stock dividends and ratings, than
>> >long term health of the company and the product.
>> >And public traded companies end up just that way.
>> >Whitelightning
>> >
>>
>>
>> I think Ford (and GM and Chysler) is in a lot worse shape than they
>> admit. They only chance any of them have to survive is to get labor
>> cost way down and improve quality. It will never happen in current
>> structuring. They are kidding themselve (managemtn and Labor) if they
>> think they can pull it off otherwise. Prices have reached critical
>> mass and can no longer sell to support current costs and benifits. If
>> they all could cut labor costs 30% or more they could sell vehicle 15%
>> cheaper across the board and make a profit and boost sales but they
>> seem to keep hoping that people will except pay more for their car
>> than some did for a house 20 years ago. The worst is yet to come for
>> them.
>> -----------------
>> TheSnoMan.com
>
>
> your wrong there- how "bad off" can they be, when GM is #1 in sales
> units, and Ford is #3 ??
>
> Toyota is number 2, gee, they must be worse off than GM then, aren't
> they...
>
> stop listening to CNN and the gloom and doom liberal press- the
> American Big Three are alive and well.
>
> If Ford "lost" 5.8 billion, and had 50 billion in assets, well 2nd
> grade math says, they still have 44.2 billion in assets. And that
> "loss" can be disputed, as it's an accounting loss, taking in wasting
> assets, depreciation, bad debts, etc. Lots of stuff they can write
> off and save on taxes with.
>
> that's a lotta dough, pal !
>
You can be #1 in sales, but still taking losses if it it is costing you too
much per vehicle to produce. Toyota can be #4 for that matter and be making
a killing. For example, Ford can cut the price of their vehicles in half.
Sales would go way up as people flocked to get half price cars, but they
could not exist long in doing so.
John
John