To Be a Ford Dealer 20 comments
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Ford (F) has definitely separated itself amongst the Big 3 US automakers over the last few months. As Chrysler has filed for bankruptcy and GM continues to struggle, Ford's stock has risen nearly 200% year to date.
On Intrade.com, traders can bet on whether or not GM or Ford will file for Chapter 11 bankruptcy by the end of the year. The disparity between the two really shows up in these contracts. The Intrade odds for a GM bankruptcy by 12/31/09 are at 85.1%, while the bankruptcy odds for Ford are only at 5%. While almost all automakers are still struggling to sell cars, investors are clearly betting that Ford will at least survive.
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The competitive strengths for the auto industry, particularly for Ford is not efficiency, better product line up and etc., It is hot to compete with Uncle Sam?
With regard to price Ford cannot compete with the bottomless subsidy from Uncle Sam to GM and Chrysler. With Uncle Sam and UAW as partners GM and Chrysler will never be portrayed as losers, which means anything and everything to protect GM and Chrysler is fine. If Ford has to survive then there is no alternative other than join the consortium. Foreign auto companies are also exposed, at least they do not have to contend with the negative stigma associated with the big 3.
Smart money will get out of Ford fast.
I agree with the many analysts I've read who target Ford for a share price between $7.50 to $8.00 in the next 18 months, so long as they continue to work on the forward looking issues that have been on their agenda over the last few years.
On May 11 01:07 PM Ed Witt wrote:
> I think the American taxpayers should unite behind Ford to ensure
> that there is no more tax money lost for taxpayers.....everyone should
> buy Ford...Lincoln...Mercu... The truely American auto manufacturer
> that is smart enough to manage itself.
As result, the car companies won't have the continuous market the once enjoyed, including Ford.
Don't get me wrong. I want Ford to succeed and so do its secured bondholders. Auto sales need to get back to 12+ MM and soon.
Setting aside the state of the economy, and Ford mortgaging everything - including the trademark Ford name - Ford has made a success out of this mess without bailout money from the Federal Government.
But wait! US Treasury Secretary Tim Geithner has a new surprise in store: Federal funds for GMAC (GM 1.44 ↓10.56%) to support GM and Chrysler dealers effect consumer new and used vehicle sales transactions.
This is something akin to the US Treasury placing a team of Federal F&I Managers in each GM and Chrysler store.
Can Ford win this new battle, the one with an unlimited ante courtesy of the US Treasury in the former “Free Enterprise” poker game?
Let me get this straight - the US Taxpayer is now going to subsidize a private business (i.e., Cerberus who owns Chrysler and GMAC) even further.
Remember how the Administration first told us how Chrysler’s loan was going to be paid back, only to have it “quietly” go unpaid in the Chrysler bankruptcy fling last week, with the Administration happy to go for the note?
Now, GMAC will now make car loans for new vehicles bought from subsidized car companies (Chrysler or GM - your pick) to build numerous cars US buyers really don’t want, and then subsidize US Taxpayers to buy these same undesirable vehicles.
That the mainstream media has given the Administration yet another “pass” is not remarkable. That it doesn’t pass the “smell test” for fairness to Ford however, is not lost on veteran auto industry observers.
That said, recent history strongly suggests that all this “help” from the government comes with many strings, which, no doubt, will continue to push the two subsidized car companies to engineer more social change than new cars and trucks consumers really want.
My money’s on Ford.
One may prefer to phrase it, "bettors are clearly gambling that
Ford will at least survive"
On May 13 08:17 AM Dean M wrote:
> I have a problem buying any of the big three and allowing 1 penny
> to go to the UAW. Once that mafia is closed down I might buy American.
and i guess the fact that a lot of the top 20 cars sold happen to be American isn't an indication that Americans do like the domestics? and while Ford has done well, they are so in debt they will have problems (though they certainly are making better cars!). they told the government back in December if the car market isn't over 10 million units they will need a loan . and the chances of that happening is nill.
On May 12 03:01 AM TheCarCzar wrote:
> How many battles can Ford fight at once?
>
> Setting aside the state of the economy, and Ford mortgaging everything
> - including the trademark Ford name - Ford has made a success out
> of this mess without bailout money from the Federal Government.<br/>
>
> But wait! US Treasury Secretary Tim Geithner has a new surprise in
> store: Federal funds for GMAC (GM 1.44 ↓10.56%) to support GM and
> Chrysler dealers effect consumer new and used vehicle sales transactions.
>
>
> This is something akin to the US Treasury placing a team of Federal
> F&I Managers in each GM and Chrysler store.
>
> Can Ford win this new battle, the one with an unlimited ante courtesy
> of the US Treasury in the former “Free Enterprise” poker game? <br/>
>
> Let me get this straight - the US Taxpayer is now going to subsidize
> a private business (i.e., Cerberus who owns Chrysler and GMAC) even
> further.
>
> Remember how the Administration first told us how Chrysler’s loan
> was going to be paid back, only to have it “quietly” go unpaid in
> the Chrysler bankruptcy fling last week, with the Administration
> happy to go for the note?
>
> Now, GMAC will now make car loans for new vehicles bought from subsidized
> car companies (Chrysler or GM - your pick) to build numerous cars
> US buyers really don’t want, and then subsidize US Taxpayers to buy
> these same undesirable vehicles.
>
> That the mainstream media has given the Administration yet another
> “pass” is not remarkable. That it doesn’t pass the “smell test” for
> fairness to Ford however, is not lost on veteran auto industry observers.
>
>
> That said, recent history strongly suggests that all this “help”
> from the government comes with many strings, which, no doubt, will
> continue to push the two subsidized car companies to engineer more
> social change than new cars and trucks consumers really want.
>
> My money’s on Ford.
On May 13 12:08 PM dw57 wrote:
> i have a problem buying any foreign car. i would rather buy American,
> at least there is hope the profits could be spent here, as opposed
> to some place else. and maybe even make it so jobs here might continue
> to exist
On May 13 12:32 PM Dean M wrote:
> If you support the UAW you are negating the possibility of having
> a viable auto industry in this country
On May 13 02:11 PM dw57 wrote:
> why do you think that? if you compare UAW to what German auto workers
> make, UAW workers are cheap. so far it appears that the UAW has only
> opened their contracts how many times so far? about 6 or 7 times
> long before they were due to do so. and they have removed how many
> things from these contracts? maybe you just hate that some of your
> fellow Americans actually make a living, which you think reduces
> yours. news, it doesn't it makes so yours can get better.