Ford Sees China Driving Future Amid U.S. Retreat [Wall Street Journal]
Summary: In an interview in China with the WSJ, Ford chairman Bill Ford Jr. spoke candidly about the automobile business and how Asia, and specifically China, will likely become more important than the U.S. domestic market. Ford is finishing construction of two factories in China with its Japanese partner Mazda and a local partner, one for engine production, and the other for assembly. Mr. Ford commented, "There's going to be no market like China for us. We're barely scratching the surface." The firm's purchase of auto parts in China for assembly use in the U.S. is seen growing to $2.6-$3.0 billion this year, compared to $1.6-$1.7 billion last year. Aside from China, Ford said any other talk of new alliances is a distraction. Given the firm's cash needs, Ford said he plans to sell Aston Martin sometime next year, but has no plans to sell Jaguar. He affirmed Jaguar's problems are business- and not quality-related. Ford also recognized the shift in consumer demand for smaller cars, putting the U.S. more in line with European and Asian markets.
Related links: Excerpts of WSJ Interview • Ford Bleeds $5.8 Billion in Q3 • Toyota Speeds Ahead of Competition in China • Ford: SEC Comment Letter Slipped Through The Cracks • Detroit Gets it Right This Time • A Blow To Ford In The Battle Between Auto and Parts Manufacturers • Ford's Burn Rate Worries Analysts • Barron's Nine Tips for Ford's New CEO • Ford Q3 2006 Earnings Call Transcript
Potentially impacted stocks and ETFs: Ford (NYSE:F), General Motors (NYSE:GM), DaimlerChrysler (DCX), Toyota (NYSE:TM), Honda (NYSE:HMC), Nissan (OTCPK:NSANY)
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