Shocker: Ford posts a profit

posted at 7:20 pm on July 24, 2009 by Ed Morrissey

Ford surprised a lot of people, probably no set more than the White House, in posting a quarterly profit of over $2 billion.  The automaker, who eschewed a government bailout, credited better products and management for ending four quarters of losses.  They also grew their market share and lowered their debt load in the middle of the worst recession in decades:

In recent months, the carmaker has claimed market share from its American rivals, General Motors and Chrysler, while those companies struggled to restructure their operations in bankruptcy court.

Ford executives now say the automaker is on track to return to annual profitability in 2011. …

Ford’s gains were aided by rapid cost cutting in the second quarter. Ford reduced its debt obligations by $10.1 billion, which will save the company more than $500 million a year in interest expense. It raised $1.6 billion by issuing common stock. The company said it also cut “structural” costs by $1.8 billion, in part by eliminating 1,000 U.S. hourly jobs through buyouts. …

Under Mulally, Ford appears to be building better cars and trucks, analysts said. The Ford Fiesta, which launches in the United States next year, is now Europe’s second-best-selling car.

That doesn’t mean that Ford is out of the woods, but they’re doing a far sight better than Government Motors and Chrysler.  Instead of delaying inevitable tough decisions by taking a handout from either the Bush or Obama administrations, Ford went to work on the structural problems that had them on the brink of oblivion.    Their turnaround showed that hardnosed cost-cutting and product improvements could rescue a company, rather than a Deus ex machina bailout that would have maintained a sclerotic status quo.

Mullaly also had bad news for the White House in its forecast.  He told analysts that Ford expected the economy to improve a little at the end of the year, but nowhere near earlier forecasts.  If Mullaly is right, the Obama administration will have to deal with much higher deficits than first forecasted — and its investment in Ford’s competition may wind up for naught.


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Comment pages: 1 2

Suspect Ford got a boost from the boycott of Government Motors and Chrysler/UAW/Fiat. Now Chrysler is taking the cash for clunkers government money and combining it with their bailout money to offer double rebates to anyone buying a Chrysler product. Sort of an unfair fight to use taxpayer money against Ford, but hey, Obama is anything but fair.

Christian Conservative on July 24, 2009 at 11:22 PM

Bumpsticker-

FORD: THE OBAMA FREE VEHICLE

Go Henry!

profitsbeard on July 24, 2009 at 11:28 PM

Mullaly also had bad news for the White House in its forecast. He told analysts that Ford expected the economy to improve a little at the end of the year, but nowhere near earlier forecasts.

I’d say Mullaly is being a bit too optimistic, but he is nowhere near the fantasy land that Barry and the gang and his camp followers in the press are.

Vashta.Nerada on July 24, 2009 at 11:29 PM

Watch out Ford. Our new socialist government doesn’t want you evil companies making profits. It is sure to redistribute the weatlth by either taxing you to death or feeding the weakened GM and Chrysler so they can compete with you.

shick on July 24, 2009 at 11:38 PM

I believe in Ford and it’s products (I own and F150). They are going to come out on top in a couple of years. Once I free up some capital, i’m going to invest in their stock once more.

ayrab on July 24, 2009 at 7:25 PM
They’re doing something right.

My dad owned a 1993 F150 and it’s still running.

Chaz706 on July 24, 2009 at 7:31 PM

(Yes i know its not meant to be Auto Corner or whatever!) I love the F150 although it doesn’t really work in the Aussie market. Great looking pick up however. I am especially keen to see Ford improve and prosper in sedans .
Versus Toyota 4×4′s they have a tough job ahead. I run a ‘Cruiser 4.2 Diesel utility(HJ75 series -unfortunately popular with jihadi Fknuckles!). In tough conditions these vehicles routinely do 300,00 miles without any more than regular oil changes etc.Treat them well and they do another 200,00 miles.Beat that and play fair!.
Ford need some flexibilty; meaning a greater choice of engines and transmissions in their products in the Australian market. To whit, the Ford Territory a commendable but underdeveloped SUV. Unsurprisingly, at this stage Dearborn will not OK the expense.
We wait in hope!

Mattmax on July 24, 2009 at 11:48 PM

No shocker. Telling Obama to pack sand can only mean good things.

macummings on July 25, 2009 at 12:40 AM

Who didn’t see this coming?

- The Cat

MirCat on July 25, 2009 at 12:50 AM

…that Roush Mustang looks better and better each day.

liquidflorian on July 25, 2009 at 3:40 AM

My Dads’ first car was a 1952 Ford. After that, he always bought Fords. So have I. My kids have Fords and my wife and I drive Fords. We will never change.

BobK on July 25, 2009 at 5:45 AM

I remember my first Ford as a kid. ’64 Country Squire wagon.
We dropped in a 390 Police Interceptor in. Light Blue with “woody sides” is was great for drive in movie dates.

Jeff from WI on July 25, 2009 at 6:05 AM

You will never see me drive a government made Chevy or Dodge product, never.

bluegrass on July 25, 2009 at 9:09 AM

- 1989 Lincoln Town Car
- 1992 Ford F150
- 1996 Ford E150
- 2005 Ford Taurus

John on July 25, 2009 at 9:19 AM

I’ll but South Korean. Nice cars, great warranty & price,and they were ALWAYS our ally and never bombed Pearl.

Jeff from WI on July 24, 2009 at 8:20 PM

In the early ’80′s, S.K. targeted only American
imported cars $10,000 tariff when automakers were
going through a recession. I hold a grudge.

deptofredundancydept on July 25, 2009 at 10:42 AM

If I had to buy American again, I would gladly forgive Ford for my ’92 Exploder and only buy the Ford nameplate. I will never buy a Government Motors vehicle.

TexAz on July 25, 2009 at 11:19 AM

Life long chevy buyer here,, um until this year,, first time ford buyer- super duty 250. Pearl. Love it. Sweeter knowing I am not supporting govmoters..

tinkerthinker on July 25, 2009 at 12:33 PM

In the early ’80’s, S.K. targeted only American
imported cars $10,000 tariff when automakers were
going through a recession. I hold a grudge.

deptofredundancydept on July 25, 2009 at 10:42 AM

I hold a bigger grudge for Pearl & Hitler

Jeff from WI on July 25, 2009 at 12:33 PM

I’m with you jeff, but Pearl
was FDR’s not making A PHONE CALL.

deptofredundancydept on July 25, 2009 at 1:26 PM

Not only that, but the F-150 still outsells America’s best selling car, the Toyota Camry.

rightwingprof on July 25, 2009 at 2:17 PM

This is so awesome. I was a GM/Chrysler buyer before. Never again. I have a 2008 Dodge Gr. Caravan (before the bailout), and I wanted the new Dodge Challenger, but that was before. Now I’m going Ford.

Black Adam on July 25, 2009 at 6:43 PM

Obviously, this is a hate crime.

PattyJ on July 25, 2009 at 7:03 PM

Wanna kick Bammy to the curb and prove that American Ideas work and Govt bailouts don’t…BUY A FORD TODAY!

FORD, WE DON”T WANT TO BE ON THE DOLE, WE JUST WANT TO BE YOUR CAR COMPANY

JohnD9207 on July 25, 2009 at 9:42 PM

good for them! I was in a Saturn dealership today … tumbleweed was running through the showroom. Very sad.

virgo on July 26, 2009 at 3:28 AM

And just think, all the taxes that they’ll pay on those earnings goes to G.M.

So at the end of the day Ford actually made a profit for G.M.

TheSitRep on July 26, 2009 at 5:30 AM

Amazing what a free system does for companies that are not attached directly to the unions and government like chevy.

workingforpigs on July 27, 2009 at 10:04 AM

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