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Ford (F -1.1%) says it will boost production this summer by trimming its summer shutdown to one...

Ford (F -1.1%) says it will boost production this summer by trimming its summer shutdown to one week from the traditional two-week period. The move will allow the automaker to crank out another 40K vehicles and falls in line with its plan to increase annual production by 400K.
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Comments (15)
  • Terry330
    , contributor
    Comments (870) | Send Message
     
    President Obama saved millions of jobs,auto,retail,servi...
    8 May 2012, 01:46 PM Reply Like
  • gmmpa
    , contributor
    Comments (604) | Send Message
     
    Just what we need... 4 more years of Obama... Shoot me now and save me from what he does and not what he says. He has saved so many jobs that only 88 million Americans are out of work. If he keeps saving jobs at this rate we will all be workng for Ford or the government soon.

     

    It is safe to say the Obama did not save any jobs at Ford.
    9 May 2012, 12:32 AM Reply Like
  • flumeride
    , contributor
    Comments (324) | Send Message
     
    Obama did nothing that any other president would have done by helping GM and Chrysler. He just did it different and in a partisan manner. It was really a political move to secure votes. Reagan saved Chrysler in the 80's. It was important to save GM and Chrysler if for no other reason to save all the smaller third party suppliers. However, the handling of the bankruptcy was bizarre and in one instance they broke a precedent. The precedent in bankruptcy is that the bond holders and other debt holders receive the lion's share of equity in the company that emerges from bankruptcy. This was not the case with this administration and a democratic super majority in congress. They gave the lions share of equity to the unions and of course the federal government. Then they closed down hundreds of family owned dealerships. I see no reason to force dealers out of business. Let them compete for survival. The craziest move was shutting down Saturn. It was the one entity of GM that made small economical cars, but it wasn't a union shop. So really what Obama did was save the unions, not the auto companies.
    9 May 2012, 01:53 PM Reply Like
  • youngman442002
    , contributor
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    He is a GOD...just ask him...
    8 May 2012, 01:56 PM Reply Like
  • Ryandan
    , contributor
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    Make those dealers eat that inventory....... yeah!!! Now how do we spin this....?
    8 May 2012, 03:09 PM Reply Like
  • Tdot
    , contributor
    Comments (5016) | Send Message
     
    How about this: Ford is only working to balance dealership inventories to meet projected consumer demand and maximize profits, not forcing anything through the pipeline. Ford has no interest in engaging in a money losing price or incentive war.

     

    Profitable growth is Ford's goal, and you cannot grow profits without growing sales, and you cannot grow sales if there are insufficient cars on the lots. The dealers are placing orders in anticipation of sales demand, and all the models suggest the demand is there and will continue to be for something like 15M units this year, and Ford is boosting production to meet demand and maintain market share. If Ford's dealers are short on cars that folks really want, then those folks will shop elsewhere, and Ford loses both market share and profits. Ford's got an excellent production and inventory planning model that maximizes the profit potential in any scenario, and right now the model is screaming "build them, and they will come, and they will pay a lot for the privilege."

     

    It really is that simple.

     

    As previously mentioned, highly profitable pickup sales are up 4.4%, Taurus is up 6.4%, Explorer is up 6.6%, Edge is up 12.4%, and Focus is up 12.5%. These vehicles constitute much of the meat of the profit generators, and the traditionally bestselling New 2013 Fusions and Escapes are coming fast, and they are expected to sell like hotcakes once they show up on the showroom floors.

     

    All this bodes well for profitable growth - at least in North America.

     

    Now to be sure - if things develop in the coming weeks and months such that demand starts to slack off back down to the 14M or less range, and unsold inventories start to build up past the 2-3 month level, then you can bet Ford will shut down those production lines as originally planned and more. But right now, Ford needs to get some of the line workers and the parts suppliers on board with committing to working through the traditional summer holiday shutdown. It only applies to those vehicles that are already or will be in short supply, and don't need to use the time to switch the tooling over to the next model year.
    9 May 2012, 05:36 AM Reply Like
  • Ryandan
    , contributor
    Comments (1614) | Send Message
     
    Thanks for showing me the "spin" in increased manufacturing.......
    9 May 2012, 09:32 AM Reply Like
  • Ryandan
    , contributor
    Comments (1614) | Send Message
     
    Tdot

     

    Last May Ford was at 15 / Last Oct - 10 / Last Feb - 13 / Now - 10.5.

     

    In the mean time the Dow set a new high.

     

    Tdot "Did Ford gain or lose, relative to competitors?"

     

    The real question is what direction is Ford going relative to the rest of the world? If it can't get off 10 it can't pay the dividend, etc. etc. You should put all that energy into a company that actually went up since last Oct.
    9 May 2012, 10:09 AM Reply Like
  • flumeride
    , contributor
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    Don't confuse stock price with revenue and sales. The stock may be flat and even down, but sales have continued to grow. Ford is doing better than GM and Chrysler. So compared to competition Ford is not doing bad. However, the real competition is Toyota and Volkswagen. At this point Ford is holding its own. The new Fusion and Focus are getting rave reviews and will do well internationally and domestically.

     

    I don't know what you mean by "If it can't get off 10 it can't pay the dividend". Stock price has nothing to do with the ability to pay a dividend. A lower stock price just gives us an opportunity to get a higher yield.
    9 May 2012, 02:04 PM Reply Like
  • Josh Krause
    , contributor
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    Exactly. Just ask yourself. Would I rather have a 10 year treasury bond right now or a share of F because F is now paying a higher yield.

     

    Sadly that is probably the time frame one is going to need to see significant appreciation, but the dividend allows you to wait pain free.
    9 May 2012, 05:09 PM Reply Like
  • Ryandan
    , contributor
    Comments (1614) | Send Message
     
    Wow, a dividend........ Let's see, I buy a stock at $20 a share and it pays a 15 cent dividend. A year later it's selling for $18 a share. But I'm getting a dividend. Yeah, I'm a winner!

     

    It's May, look at last year. If the market drops like it did last year, you would be better off putting your money in your hat.

     

    flumeride: "I don't know what you mean by "If it can't get off 10 it can't pay the dividend". Stock price has nothing to do with the ability to pay a dividend. A lower stock price just gives us an opportunity to get a higher yield."

     

    If Ford can't get it's stock value above 10 it will drop the dividend. And what does "gives us an opportunity" mean? You a Ford employee?

     

    And "don't confuse stock price with revenue and sales?" Well, I guess a stock price comes from a dart board, because I thought revenue and sales determines the value of a company - which shows in the stock price. I must be confused......
    10 May 2012, 08:13 AM Reply Like
  • Josh Krause
    , contributor
    Comments (1361) | Send Message
     
    Paying the dividend has no relation to the stock price. Dividends are paid out of cash generation which they have plenty of and earnings which they also have, so the dividend is not at risk due to the stock price breaking 10.

     

    Just makes it more attractive from a yield perspective, especially if they are able to increase the dividend.
    10 May 2012, 08:16 AM Reply Like
  • Ryandan
    , contributor
    Comments (1614) | Send Message
     
    It's a house of cards. They need the stock value to go up to help get a better credit rating and better company valuation. Trust me, they stay at 10 long enough your dividend gets suspended. Plenty of cash generation and earnings? What balance sheet are you reading? Just their cost of expansion and upgrades could sink them if sales drop. How about those loans they took out a couple years back?

     

    The point is they can't get anyone to buy their stock above 11 right now. That's a serious problem for them. So what half baked out of the can excuse do they use for that? Meanwhile, Toyota is running away with profit increases. ???
    10 May 2012, 10:06 AM Reply Like
  • Tdot
    , contributor
    Comments (5016) | Send Message
     
    RyanDan - yes we do argue the facts a lot, don't we? And you seem to enjoy stalking and calling me out for stating the facts as "supporting the company spin" or whatever. How sad.

     

    I simply study Ford's reports to the SEC and shareholders (they are open to the public and available for downloading and review from Ford's web site!), and then I provide a condensed "just-the-facts" version for "civilians" who don't have the time to study and report. You can always claim that Ford is lying to the SEC and shareholders, "conspiracy theory" style, but it really gets you nowhere in the real world.

     

    The vast majority of the loans have been paid. The remaining loans include the very low interest rate loans from the Department of Energy ($5B) for new fuel efficiency technology development, and production of hybrids (etc.) in old SUV plants, and a very few billion left of the $23B "home improvement loan" borrowed back in '06. Between Ford Motor and Ford Credit the Cash holdings outweigh the remaining Debts by about $23B, or about $5.75 per share in free cash.

     

    Ford's performance as a going concern has little to nothing to do with share price. External noise factors, such as global economic affairs and threats are overwhelmingly driving the buying and selling of Ford shares. The price is driven by supply and demand. if a lot of sour investors decide to bail out then the price falls. If a lot of happy investors buy it up, then the price rises. Simple as that.

     

    Please by all means sell your shares and do so immediately. The "rest of us" want to buy your shares cheaply. Please everyone else sell out on Ford - the real investors who want to make money like to buy it as cheaply as possible. It is like 89 cent loaf of bread days at the supermarket - that is the time to buy.
    11 May 2012, 08:12 AM Reply Like
  • flumeride
    , contributor
    Comments (324) | Send Message
     
    Ford will not drop the dividend because the stock price drops below 10. Ford makes no money from its stock. Ford is not selling the stock. If earnings fall, then Ford might lower or stop the dividend. However, they are being very prudent with the dividend at this point. The payout ratio is 1%, which is ridiculously low. This means that the dividend is only 1% of earnings.
    10 May 2012, 05:16 PM Reply Like
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