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"But it makes good cars now."

That's what I hear more often than not in the comments section on this site, or through emails, or in cocktail conversation when my recent frets over Ford (NYSE:F) crop up.

For a couple of years, Ford was one of my favorite stocks. Along with Starbucks (NASDAQ:SBUX) CEO Howard Schultz, Alan Mulally, Ford's CEO, is only of the few company heads I just plain like. I liked, too, that Ford didn't go on the government dole, like General Motors (NYSE:GM), as I thought that bought them a store of public goodwill.

And I liked those good cars it makes now. In many ways, they finally hold their own or beat offerings from Honda (NYSE:HMC) and Toyota (NYSE:TM).

Nevertheless, more recently I thought Ford was still a touch too reliant on bigger cars and I worried like the dickens about the economy, especially in Europe.

Ford reported second-quarter profit down a disappointing 57%, but worse (if you can believe it) said it will lose more than $1 billion in Europe in 2012, twice its estimate from the beginning of the year. That amounts to a free fall.

Ford joins a parade of unfortunates -- from UPS (NYSE:UPS) to Xerox (NYSE:XRX) -- that have cut numbers due to European business dancing off the lip of a cliff. But the gathering losses provide a lesson: it's never just what you are selling. It's where you are selling it.

Ford is frighteningly reliant on the European region, where they scare up about a quarter of their sales and revenues. Considering, that's scary.

With the stock now weak, someone may approach you and suggest buying Ford, saying: "Hey, look at those cars. It's gotta' be the cars."

Just tell them that it's not just what you are selling, but where you are selling it. And if you are selling a quarter of your goods in an economically imploding area, it doesn't matter if they are jalopies or gold-plated chariots.

They are not going to sell. Stay away from this one.

Source: It's Gotta Be The Cars! No, Mars