Ford Announces Worst Quarter Loss In History
http://www.theweeklydriver.com/articles/1268/1/Ford-Announces-Worst-Quarter-Loss-In-History/Page1.html
By The Weekly Driver News Service
Published on 07/24/2008
As if rumors of General Motors’ demise to the selling longstanding brands like Jaguar to Land Rover to international manufacturers isn’t enough turbulence for the U.S. auto industry, there’s more bad news. Ford Motor Co. has announced its worst quarterly performance in ihistory, a loss of $8.67 billion in the second quarter of this year.
As if rumors of General Motors’ demise to the selling longstanding brands like Jaguar to Land Rover to international manufacturers isn’t enough turbulence for the U.S. auto industry, there’s more bad news. Ford Motor Co. has announced its worst quarterly performance in ihistory, a loss of $8.67 billion in the second quarter of this year.As if rumors of General Motors’ demise to the selling longstanding brands like Jaguar to Land Rover to international manufacturers isn’t enough turbulence for the U.S. auto industry, there’s more bad news. Ford Motor Co. has announced its worst quarterly performance in ihistory, a loss of $8.67 billion in the second quarter of this year.
As a result, Ford said it will retool two more North American truck and sport utility vehicle plants to build small, fuel-efficient vehicles.
Additionally, Ford plans to bring six new small vehicles to North America from Europe by the end of 2012.
Ford’s net loss includes $8.03 billion worth of write-offs because of the sharp decline in U.S. truck and SUV sales has reduced the value of Ford's North American truck plants and Ford Motor Credit Co.'s lease portfolio.
Excluding those items, Ford lost 62 cents per share. Including the write-downs, Ford lost $3.88 per share in the April-June quarter, compared with net profit of $750 million, or 31 cents per share, in the same quarter a year ago.
The second-quarter loss surpassed Ford's previous record quarterly loss, $6.7 billion in the first quarter of 1992.
Second-quarter revenue was $38.6 billion, down $5.6 billion from the year-ago period.
Ford has been successful selling cars in Europe, and it’s counting on its the new European models to boost sales and revenue.
The company said it has sufficient liquidity to weather the latest downturn in the U.S. auto market without additional borrowing. Ford borrowed $23.4 billion in 2006 to fund its North American turnaround.
Ford will shift its Michigan truck plant in suburban Detroit from an emphasis on large SUVs to global vehicles off the European Focus platform by 2010.
The SUVs made at Michigan Truck - the Lincoln Navigator and Ford Expedition - will be shifted to the Kentucky Truck plant in Louisville, which makes Ford Super Duty pickups.
The company also will retool the Louisville Assembly Plant, which now builds the Ford Explorer midsize SUV, to produce vehicles on the European Focus frame, starting in 2011.
Ford said it does not expect a U.S. economic recovery to start until early 2010.
The company identified only three of the European small vehicles it will bring to North America: the Transit Connect small van, the European Focus and the subcompact Fiesta. Most will be built in North America, but the Transit Connect will be imported from Turkey. Ford said the other three vehicles would be identified later but could the Kuga small crossover, the C-Max small van and the Mondeo midsize car.
As a result, Ford said it will retool two more North American truck and sport utility vehicle plants to build small, fuel-efficient vehicles.
Additionally, Ford plans to bring six new small vehicles to North America from Europe by the end of 2012.
Ford’s net loss includes $8.03 billion worth of write-offs because of the sharp decline in U.S. truck and SUV sales has reduced the value of Ford's North American truck plants and Ford Motor Credit Co.'s lease portfolio.
Excluding those items, Ford lost 62 cents per share. Including the write-downs, Ford lost $3.88 per share in the April-June quarter, compared with net profit of $750 million, or 31 cents per share, in the same quarter a year ago.
The second-quarter loss surpassed Ford's previous record quarterly loss, $6.7 billion in the first quarter of 1992.
Second-quarter revenue was $38.6 billion, down $5.6 billion from the year-ago period.
Ford has been successful selling cars in Europe, and it’s counting on its the new European models to boost sales and revenue.
The company said it has sufficient liquidity to weather the latest downturn in the U.S. auto market without additional borrowing. Ford borrowed $23.4 billion in 2006 to fund its North American turnaround.
Ford will shift its Michigan truck plant in suburban Detroit from an emphasis on large SUVs to global vehicles off the European Focus platform by 2010.
The SUVs made at Michigan Truck - the Lincoln Navigator and Ford Expedition - will be shifted to the Kentucky Truck plant in Louisville, which makes Ford Super Duty pickups.
The company also will retool the Louisville Assembly Plant, which now builds the Ford Explorer midsize SUV, to produce vehicles on the European Focus frame, starting in 2011.
Ford said it does not expect a U.S. economic recovery to start until early 2010.
The company identified only three of the European small vehicles it will bring to North America: the Transit Connect small van, the European Focus and the subcompact Fiesta. Most will be built in North America, but the Transit Connect will be imported from Turkey. Ford said the other three vehicles would be identified later but could the Kuga small crossover, the C-Max small van and the Mondeo midsize car.