Ford (F) reaches an agreement with authorities in France to keep 1,000 employees at a Blanquefort factory. In exchange for the company's promise to retain the workers, the local government will invest €12.5M with Ford's €125M to produce gearboxes at the location. [View news story]
There are plenty of automakers that do not have a unionized work force, and they and their employees are doing just fine with exactly zero complaints on either side. Union Thugs show up from time to time with proposals to organize the labor force, and they are laughed out of the room every time by the very laborers they propose to "save".
Unions have outlived their usefulness, and have resorted to blackmail to try to get their way in supporting inefficient Old World practices that are noncompetitive. This forces businesses out of business, or forces them to shut down overstaffed and inefficient operations to avoid bankruptcy, unless the Local, State, and/or National Governments offer bribes paid by taxpayers to cover the losses.
As Ford Enhances Its North American And Asian Production, I Think Its Dividend Has Potential [View article]
The professional analysts' estimates for Ford's 2013 range from a low of $1.16 to a high of $1.55, so your personal estimate of $1.54 is not terribly far off the mark. The consensus though is at $1.40 ... it has been pretty steady there for the last 9 months, and 2012 came in at $1.41 if that means anything. In any case, you have to look at what has changed since 2012 in terms of global profitability, market share, and growth potential.
In 1Q13, Ford's after tax earnings were 40 cents per share, up from 35 cents in 1Q12. 2Q13 is estimated at 36 cents, up from 30 cents in 2Q12, while 3Q13 is estimated at 33 cents, up from 30 cents in 3Q12; leaving about 31 cents for 4Q13, before any special accounting adjustments and things.
Meanwhile, Ford's Automotive cash reserve is $24B, while the debt is $16B, leaving $8B in net cash after debt. This is actually down from $9B a year ago, and from $10B before that, meaning Ford's Automotive business is currently borrowing and spending more cash on capital and product development than it is earning - about $250M per quarter or 6 cents per share. Much of this is investment in the future - building plants in Asia, closing them in Europe, introducing newly-developed products globally, shutting down outdated product lines, etc. Ford's Credit business is making up the difference, meaning cash is flowing from the Child to the Parent Company to balance the books.
Ford just announced that product development and production in Australia will end in the next 3 years, which will mean writing off billions in capital property in that time frame, with only the sales and marketing staff remaining employed in the land Down Under. Ford's last remaining full-size rear wheel drive Falcon / Territory platform appears doomed. Again, all this will require a substantial write-down of assets, which investors don't like to hear and usually react negatively in the time frame. It tends to neutralize any good news in terms of market share growth and such.
So anyway, in the 1Q13 Ford's US operations were up on wholesales (17%), revenues (20%), and profits (14%), while operating margins were down slightly at 11%. Meanwhile Ford lost 9.4% in South America, lost 6.9% in Europe, and barely squeaked out a 0.2% profit margin in Asia-Pacific and Africa.
Ford hopes to maintain about 16% market share this year in the US, 8% in Europe, and maybe 4% in China, only moderately better than 2012. The 1Q13 performance essentially matches those numbers. Ford has provided no guidance that suggests it will do much better than that for the rest of the year. The challenges for the year are essentially neutralizing the triumphs, and the analysts are quite aware of these factors, and they have come up with the $1.40 per share consensus.
2Q13 results will come out in about 2 months. Meanwhile, keep an eye on Ford's monthly global wholesales and global market share, not just the triumphant US operations, to get a realistic idea if they are meeting or beating Company-wide expectations and their previous guidance.
So, if Ford does not raise the dividend (and there is absolutely no fundamental basis for them to do so - they are burning up the net cash reserve at $250M per quarter and going deeper into debt, and the current 10-cent dividend is costing them some $400M each quarter!), would that mean SELL SELL SELL for you?
Ford (F) reaches an agreement with authorities in France to keep 1,000 employees at a Blanquefort factory. In exchange for the company's promise to retain the workers, the local government will invest €12.5M with Ford's €125M to produce gearboxes at the location. [View news story]
Which country is that?
Are you referring to extortion by the French Government, which is forcing the automaker to continue to lose money in spending hundreds of millions more in supporting unfavorable entitlement-based contract labor conditions, in a socialistic protectionist society? All for the sake of shielding the Government from the wrath of the Union Thugs, who may force a no-confidence vote against The Regime and then support the Opposition Party if they think they may lose their jobs?
Come to think of it, that sounds exactly like the current US Regime as well.
As Ford Enhances Its North American And Asian Production, I Think Its Dividend Has Potential [View article]
Absolutely as Ford's profits rise, the share prices should rise proportionately on a P/E of 10 or so. Right now Ford is projected to earn $1.40 for 2013, and a P/E of 10 suggests $14 is about right for now, rising modestly if Ford beats.
In 2014, Ford is estimated at around $1.66, so one could expect Ford shares around $16 to $17 by this time next year, assuming Ford meets expectations.
If Ford races too far ahead of a P/E of 10 or 11, then plan for a correction back down. With 4 billion shares on the market, many in the hands of automatic trading 'bots, there is too much temptation to cash out for the profits on an unsustainable rise.
As Ford Enhances Its North American And Asian Production, I Think Its Dividend Has Potential [View article]
"shareholders could begin to see a sustainable annual increase in the company's dividend."
Shareholders could also see pigs fly.
The Dividend should be somewhat proportional to the cash flow from net after-tax operating profits. Right now Ford's 10-cent quarterly dividend, annualized to 40 cents, works out to nearly 30% of the projected profits for the year. A 25% dividend from profits is a more reasonable payout to shareholders, and Ford cannot afford to go much higher.
Next year the projected profits for Ford are around $1.66 per share, so 10 cents per quarter remains a reasonable dividend - at least until Ford can resume paying down the remaining $16B ($4 per share) in commercial Automotive Debt, not to mention the roughly $20B ($5 per share) in underfunding on global pension obligations. Ford continues to hemorage profits away in Europe, expecting to lose about $2B (50 cents per share) this year alone. Asia is growing, and Ford is starting to break even there. South America is in a sort of trade and tariff war, and car sales are not crossing borders very well, so profits there are negative. US sales and profits are sustaining Ford right now, and the competition is higher than ever, so prices and profits are being throttled back.
Ford needs at least another couple of years before Europe, South America, and Asia start to carry their own load, and to get the balance sheet firmly into the black in the global markets. At that point, we can talk about The Profits rising to double, possibly even triple, and the dividends rising proportionately with them.
Strengthening rumors of a steep 20% consumption tax on luxury cars in China could create a ripple in the automobile industry with expectations high for the segment and productions plans ramping up. On watch: Lincoln (F), Cadillac (GM), Mercedes-Benz (DDAIF.PK), Audi (VLKAY.PK), Tata Motors (TTM), and Porsche ((POAHY.PK). [View news story]
Rewind...
Tim: "Ford would be the least impacted ... lacking the presence of a strong luxury car"
JJC: "Yes Tim, so true... ", "Small cars, in the gas efficient class dominate...they are not considered luxury cars"
You said it.
Your Western values on what does or does not constitute a luxury car are irrelevant. I am simply saying the Chinese government will decide, not the author, not Tim, not you, not me. It could be that they will arbitrarily decide that the retail price cutoff for what they designate as a "luxury car" is the equivalent of $30k or so, in which case Ford is vulnerable with the new products they are introducing and hoping to sell in large numbers.
Again, what is on the road now and dominating is irrelevant. It is what is going to be coming to the market over the next several years, and that will include some midsize and larger, well equipped, premium products that could easily be judged as "luxury". Even a loaded Ford Focus Titanium tops out at over $30k in the US, and the Focus Electric comes loaded at $40k plus. They are both very luxurious compared to what the small inexpensive runabout beaters the average Chinese are driving now, as you have pointed out. If they get taxed as "luxury" cars at 20%, then they may not sell as well as hoped. And adding another $10k to an already loaded up executive edition Mondeo at $50k is what would start to seriously drive the premium market away.
I never said any of this would happen. I simply said it could - it depends on where the Chinese decide to draw the line. Remember the "luxury tax" in the US? Yes, there was one, and it was applied to non-luxury cars like the SVT Mustang Cobra at one point, since it was based on retail price point, not the brand name, nor the quality of the seat leather or whatever.
Ford (F) says it will close its plants in Australia in 2016 as a strong aussie and high labor costs weigh heavily on the Australian manufacturing sector's ability to compete with cheap imports. The closures are expected to result in the loss of some 1,200 jobs. [View news story]
That's true - Ford is counting on cashing in richly by building new Asian factories, in "partnership" with Asian automakers, to build market share and demand for Ford's global products (Fiesta, Focus, Mondeo, etc.).
As for Australia, which is part of Ford's Asia, Pacific, and Africa region, Ford is hardly abandoning the market - just shifting production sites around to improve profitability. Ford is looking to be about equally profitable in Europe, Asia, and The Americas in their Global Production Plan, and restructuring to get there is part of the process. Just like what happened in North America, and is happening in Europe.
Strengthening rumors of a steep 20% consumption tax on luxury cars in China could create a ripple in the automobile industry with expectations high for the segment and productions plans ramping up. On watch: Lincoln (F), Cadillac (GM), Mercedes-Benz (DDAIF.PK), Audi (VLKAY.PK), Tata Motors (TTM), and Porsche ((POAHY.PK). [View news story]
The point that seems to continue to escape is that CHINA will designate what constitutes a "luxury" car for extra taxation in THEIR home market, not what some Westerners think based on their values, beliefs, and or occasional visits.
Suggesting that Ford would be exempt from the luxury tax, based on Western definitions of what constitutes a "Luxury" vehicle, is a fallacious argument. And what average people drive in China right now, and for the past 10-20 years, is totally irrelevant.
Strengthening rumors of a steep 20% consumption tax on luxury cars in China could create a ripple in the automobile industry with expectations high for the segment and productions plans ramping up. On watch: Lincoln (F), Cadillac (GM), Mercedes-Benz (DDAIF.PK), Audi (VLKAY.PK), Tata Motors (TTM), and Porsche ((POAHY.PK). [View news story]
And again, it depends on how China defines and differentiates "luxury cars". If it is limited to the high end Europeans (Mercedes, Jaguar, Land Rover, BMW, Rolls Royce, Bentley, etc.), and maybe Lexus and Cadillac, then you are correct, it won't have an effect on Ford. It might even help Ford gain market share as folks on the fence step down a notch to avoid the tax.
The Chinese People however often consider US brands as pretty elite, and the Government has expressed an interest in tapping into that for taxation. Ford may get stuck with the 20% tax on products like the Mondeo, Edge, and Explorer, which are considered "premium" if not "luxury" cars in China, never mind when Ford reintroduces the Lincoln brand there.
Ford (F) says it will close its plants in Australia in 2016 as a strong aussie and high labor costs weigh heavily on the Australian manufacturing sector's ability to compete with cheap imports. The closures are expected to result in the loss of some 1,200 jobs. [View news story]
Auto companies (and others) close unprofitable, outdated, inefficient, high labor cost factories all the time, when contract negotiations fail to produce sensible business results. Sometimes they re-open later, making different products, on better labor terms, to earn a profit. Folks forget that the automaker owns the factory, and can (and should) close it, if keeping it open is losing money. It is not a charity for folks who feel entitled to personal enrichment. There must be a profitable business case for keeping it open, otherwise shut it down and do something else with the money.
Cheap imports is what shook up the US automotive industry, taking market share away from the domestic automakers, and nearly driving them out of business. Once the foothold is established, and the demand is there for the brand, then it starts to make sense for the "foreigners" to open trans-plants, perhaps as non-union facilities, in locations that maybe have less militant labor traditions.
Strengthening rumors of a steep 20% consumption tax on luxury cars in China could create a ripple in the automobile industry with expectations high for the segment and productions plans ramping up. On watch: Lincoln (F), Cadillac (GM), Mercedes-Benz (DDAIF.PK), Audi (VLKAY.PK), Tata Motors (TTM), and Porsche ((POAHY.PK). [View news story]
The point is there is a very lucrative market among upper-middle-class middle-managers in China who have maids and use chauffeurs, and mid-size vehicles are what they are buying. A $30k Fusion or in the US comes as a loaded $50k+ Mondeo in China, including HongKong, and having such a vehicle and a driver is considered pretty elite. At least that is what the automobile marketing folks are saying about China. It is a pretty new post-Olympics trend. Perhaps calling them "luxury" cars is overstretching. "Premium" is more correct.
Meanwhile, yes the yearning working masses have been driving around in small cheap domestic cars and three-wheelers, but those along with ubiquitous bicycles and motorcycles are more out of necessity for simple transportation than aspirational. The US and European automakers are not really participating or striving to gain shares in that market. Instead, they are working in partnerships with the domestics automakers to produce the higher end premium and luxury vehicles that are becoming popular among the more upwardly-mobile crowds there.
Strengthening rumors of a steep 20% consumption tax on luxury cars in China could create a ripple in the automobile industry with expectations high for the segment and productions plans ramping up. On watch: Lincoln (F), Cadillac (GM), Mercedes-Benz (DDAIF.PK), Audi (VLKAY.PK), Tata Motors (TTM), and Porsche ((POAHY.PK). [View news story]
Maybe, maybe not. It depends on how China defines a "luxury" car. In Asia, midsize cars like Ford's Fusion/Mondeo are often chauffer driven, sell for premium prices, and are considered high style.
A nice little jump in consumer sentimentbodes well for automobile companies, according to CNBC's Phil LeBeau. The outlook for the industry looks extremely good with fresh models from automakers (F, GM, TM, FIATY.PK, HMC, NSANY.OB, VLKAY.PK) coinciding with structural pent-up demand and the uptick in sentiment. [View news story]
That is an interesting point. The US automakers severely cut back on production capacity, including closing many assembly and component plants, and in paring back the Supplier base to a minimum, in order to be profitable in the US in the next Recession down to 10M units per year.
Now that the SAAR suggests we may be headed back to 16-17M units sooner than later, due to pent-up demand as cars and trucks on the road are now aging into their teens on average, the US automakers are stretching the limits of mass production just to keep up with demand, with little to no incentive discounts. It may present the Asians with a grand opportunity to flood the US market with replacement vehicles, imported and/or domestic transplants.
$17B in forgiven debt may be small potatos for a US Treasury awash in multi-Trillion-dollar debts. But for large-cap automakers like GM it represents essentially two years' worth of profits, for doing nothing more than claiming to be destitute, and passive-aggressively threatening to take down the whole automotive industry, and the national economy with it, if they don't get more bailout cash. Isn't that a kind of extortion?
Interestingly, some look at the heads and shoulder patterns on the chart for the last 6-9 months and see Ford arriving at $16 or higher by the end of the year and praise the CEO for utter brilliance (shares are already playing around with a $15 plateau), while others look at the same charts and see a (seasonal?) pull-back to or under the $12 floor, blaming the CEO for gross incompetence.
Ford (F) reaches an agreement with authorities in France to keep 1,000 employees at a Blanquefort factory. In exchange for the company's promise to retain the workers, the local government will invest €12.5M with Ford's €125M to produce gearboxes at the location. [View news story]
Unions have outlived their usefulness, and have resorted to blackmail to try to get their way in supporting inefficient Old World practices that are noncompetitive. This forces businesses out of business, or forces them to shut down overstaffed and inefficient operations to avoid bankruptcy, unless the Local, State, and/or National Governments offer bribes paid by taxpayers to cover the losses.
As Ford Enhances Its North American And Asian Production, I Think Its Dividend Has Potential [View article]
In 1Q13, Ford's after tax earnings were 40 cents per share, up from 35 cents in 1Q12. 2Q13 is estimated at 36 cents, up from 30 cents in 2Q12, while 3Q13 is estimated at 33 cents, up from 30 cents in 3Q12; leaving about 31 cents for 4Q13, before any special accounting adjustments and things.
Meanwhile, Ford's Automotive cash reserve is $24B, while the debt is $16B, leaving $8B in net cash after debt. This is actually down from $9B a year ago, and from $10B before that, meaning Ford's Automotive business is currently borrowing and spending more cash on capital and product development than it is earning - about $250M per quarter or 6 cents per share. Much of this is investment in the future - building plants in Asia, closing them in Europe, introducing newly-developed products globally, shutting down outdated product lines, etc. Ford's Credit business is making up the difference, meaning cash is flowing from the Child to the Parent Company to balance the books.
Ford just announced that product development and production in Australia will end in the next 3 years, which will mean writing off billions in capital property in that time frame, with only the sales and marketing staff remaining employed in the land Down Under. Ford's last remaining full-size rear wheel drive Falcon / Territory platform appears doomed. Again, all this will require a substantial write-down of assets, which investors don't like to hear and usually react negatively in the time frame. It tends to neutralize any good news in terms of market share growth and such.
So anyway, in the 1Q13 Ford's US operations were up on wholesales (17%), revenues (20%), and profits (14%), while operating margins were down slightly at 11%. Meanwhile Ford lost 9.4% in South America, lost 6.9% in Europe, and barely squeaked out a 0.2% profit margin in Asia-Pacific and Africa.
Ford hopes to maintain about 16% market share this year in the US, 8% in Europe, and maybe 4% in China, only moderately better than 2012. The 1Q13 performance essentially matches those numbers. Ford has provided no guidance that suggests it will do much better than that for the rest of the year. The challenges for the year are essentially neutralizing the triumphs, and the analysts are quite aware of these factors, and they have come up with the $1.40 per share consensus.
2Q13 results will come out in about 2 months. Meanwhile, keep an eye on Ford's monthly global wholesales and global market share, not just the triumphant US operations, to get a realistic idea if they are meeting or beating Company-wide expectations and their previous guidance.
So, if Ford does not raise the dividend (and there is absolutely no fundamental basis for them to do so - they are burning up the net cash reserve at $250M per quarter and going deeper into debt, and the current 10-cent dividend is costing them some $400M each quarter!), would that mean SELL SELL SELL for you?
Info: http://ford.to/yKiLVC
Ford (F) reaches an agreement with authorities in France to keep 1,000 employees at a Blanquefort factory. In exchange for the company's promise to retain the workers, the local government will invest €12.5M with Ford's €125M to produce gearboxes at the location. [View news story]
Are you referring to extortion by the French Government, which is forcing the automaker to continue to lose money in spending hundreds of millions more in supporting unfavorable entitlement-based contract labor conditions, in a socialistic protectionist society? All for the sake of shielding the Government from the wrath of the Union Thugs, who may force a no-confidence vote against The Regime and then support the Opposition Party if they think they may lose their jobs?
Come to think of it, that sounds exactly like the current US Regime as well.
As Ford Enhances Its North American And Asian Production, I Think Its Dividend Has Potential [View article]
In 2014, Ford is estimated at around $1.66, so one could expect Ford shares around $16 to $17 by this time next year, assuming Ford meets expectations.
If Ford races too far ahead of a P/E of 10 or 11, then plan for a correction back down. With 4 billion shares on the market, many in the hands of automatic trading 'bots, there is too much temptation to cash out for the profits on an unsustainable rise.
As Ford Enhances Its North American And Asian Production, I Think Its Dividend Has Potential [View article]
Shareholders could also see pigs fly.
The Dividend should be somewhat proportional to the cash flow from net after-tax operating profits. Right now Ford's 10-cent quarterly dividend, annualized to 40 cents, works out to nearly 30% of the projected profits for the year. A 25% dividend from profits is a more reasonable payout to shareholders, and Ford cannot afford to go much higher.
Next year the projected profits for Ford are around $1.66 per share, so 10 cents per quarter remains a reasonable dividend - at least until Ford can resume paying down the remaining $16B ($4 per share) in commercial Automotive Debt, not to mention the roughly $20B ($5 per share) in underfunding on global pension obligations. Ford continues to hemorage profits away in Europe, expecting to lose about $2B (50 cents per share) this year alone. Asia is growing, and Ford is starting to break even there. South America is in a sort of trade and tariff war, and car sales are not crossing borders very well, so profits there are negative. US sales and profits are sustaining Ford right now, and the competition is higher than ever, so prices and profits are being throttled back.
Ford needs at least another couple of years before Europe, South America, and Asia start to carry their own load, and to get the balance sheet firmly into the black in the global markets. At that point, we can talk about The Profits rising to double, possibly even triple, and the dividends rising proportionately with them.
Strengthening rumors of a steep 20% consumption tax on luxury cars in China could create a ripple in the automobile industry with expectations high for the segment and productions plans ramping up. On watch: Lincoln (F), Cadillac (GM), Mercedes-Benz (DDAIF.PK), Audi (VLKAY.PK), Tata Motors (TTM), and Porsche ((POAHY.PK). [View news story]
Tim: "Ford would be the least impacted ... lacking the presence of a strong luxury car"
JJC: "Yes Tim, so true... ", "Small cars, in the gas efficient class dominate...they are not considered luxury cars"
You said it.
Your Western values on what does or does not constitute a luxury car are irrelevant. I am simply saying the Chinese government will decide, not the author, not Tim, not you, not me. It could be that they will arbitrarily decide that the retail price cutoff for what they designate as a "luxury car" is the equivalent of $30k or so, in which case Ford is vulnerable with the new products they are introducing and hoping to sell in large numbers.
Again, what is on the road now and dominating is irrelevant. It is what is going to be coming to the market over the next several years, and that will include some midsize and larger, well equipped, premium products that could easily be judged as "luxury". Even a loaded Ford Focus Titanium tops out at over $30k in the US, and the Focus Electric comes loaded at $40k plus. They are both very luxurious compared to what the small inexpensive runabout beaters the average Chinese are driving now, as you have pointed out. If they get taxed as "luxury" cars at 20%, then they may not sell as well as hoped. And adding another $10k to an already loaded up executive edition Mondeo at $50k is what would start to seriously drive the premium market away.
I never said any of this would happen. I simply said it could - it depends on where the Chinese decide to draw the line. Remember the "luxury tax" in the US? Yes, there was one, and it was applied to non-luxury cars like the SVT Mustang Cobra at one point, since it was based on retail price point, not the brand name, nor the quality of the seat leather or whatever.
Ford (F) says it will close its plants in Australia in 2016 as a strong aussie and high labor costs weigh heavily on the Australian manufacturing sector's ability to compete with cheap imports. The closures are expected to result in the loss of some 1,200 jobs. [View news story]
As for Australia, which is part of Ford's Asia, Pacific, and Africa region, Ford is hardly abandoning the market - just shifting production sites around to improve profitability. Ford is looking to be about equally profitable in Europe, Asia, and The Americas in their Global Production Plan, and restructuring to get there is part of the process. Just like what happened in North America, and is happening in Europe.
Strengthening rumors of a steep 20% consumption tax on luxury cars in China could create a ripple in the automobile industry with expectations high for the segment and productions plans ramping up. On watch: Lincoln (F), Cadillac (GM), Mercedes-Benz (DDAIF.PK), Audi (VLKAY.PK), Tata Motors (TTM), and Porsche ((POAHY.PK). [View news story]
Suggesting that Ford would be exempt from the luxury tax, based on Western definitions of what constitutes a "Luxury" vehicle, is a fallacious argument. And what average people drive in China right now, and for the past 10-20 years, is totally irrelevant.
Strengthening rumors of a steep 20% consumption tax on luxury cars in China could create a ripple in the automobile industry with expectations high for the segment and productions plans ramping up. On watch: Lincoln (F), Cadillac (GM), Mercedes-Benz (DDAIF.PK), Audi (VLKAY.PK), Tata Motors (TTM), and Porsche ((POAHY.PK). [View news story]
The Chinese People however often consider US brands as pretty elite, and the Government has expressed an interest in tapping into that for taxation. Ford may get stuck with the 20% tax on products like the Mondeo, Edge, and Explorer, which are considered "premium" if not "luxury" cars in China, never mind when Ford reintroduces the Lincoln brand there.
Ford (F) says it will close its plants in Australia in 2016 as a strong aussie and high labor costs weigh heavily on the Australian manufacturing sector's ability to compete with cheap imports. The closures are expected to result in the loss of some 1,200 jobs. [View news story]
Cheap imports is what shook up the US automotive industry, taking market share away from the domestic automakers, and nearly driving them out of business. Once the foothold is established, and the demand is there for the brand, then it starts to make sense for the "foreigners" to open trans-plants, perhaps as non-union facilities, in locations that maybe have less militant labor traditions.
It is a natural progression.
Strengthening rumors of a steep 20% consumption tax on luxury cars in China could create a ripple in the automobile industry with expectations high for the segment and productions plans ramping up. On watch: Lincoln (F), Cadillac (GM), Mercedes-Benz (DDAIF.PK), Audi (VLKAY.PK), Tata Motors (TTM), and Porsche ((POAHY.PK). [View news story]
Meanwhile, yes the yearning working masses have been driving around in small cheap domestic cars and three-wheelers, but those along with ubiquitous bicycles and motorcycles are more out of necessity for simple transportation than aspirational. The US and European automakers are not really participating or striving to gain shares in that market. Instead, they are working in partnerships with the domestics automakers to produce the higher end premium and luxury vehicles that are becoming popular among the more upwardly-mobile crowds there.
Strengthening rumors of a steep 20% consumption tax on luxury cars in China could create a ripple in the automobile industry with expectations high for the segment and productions plans ramping up. On watch: Lincoln (F), Cadillac (GM), Mercedes-Benz (DDAIF.PK), Audi (VLKAY.PK), Tata Motors (TTM), and Porsche ((POAHY.PK). [View news story]
A nice little jump in consumer sentiment bodes well for automobile companies, according to CNBC's Phil LeBeau. The outlook for the industry looks extremely good with fresh models from automakers (F, GM, TM, FIATY.PK, HMC, NSANY.OB, VLKAY.PK) coinciding with structural pent-up demand and the uptick in sentiment. [View news story]
Now that the SAAR suggests we may be headed back to 16-17M units sooner than later, due to pent-up demand as cars and trucks on the road are now aging into their teens on average, the US automakers are stretching the limits of mass production just to keep up with demand, with little to no incentive discounts. It may present the Asians with a grand opportunity to flood the US market with replacement vehicles, imported and/or domestic transplants.
The Market May Favor Shorting Ford [View article]
The Market May Favor Shorting Ford [View article]