Ford Motor Company’s restructuring is on track to be completed without the carmaker seeking emergency government bridge loans and to bring a profit as soon as 2011, executives have told shareholders.
Ford shareholders also approved the company’s funding plan for a healthcare trust for UAW retirees and knocked down shareholder requests to change the voting structure and allow a smaller percentage of stockholders to call for special meetings.
The annual meeting here came just two weeks after Chrysler LLC filed for bankruptcy protection and amid industry-wide concerns that rival General Motors could follow Chrysler into court within weeks.
Ford Executive Chairman Bill Ford said the industry environment was the toughest he had seen in his three decades in the business, but he remains confident of the carmaker’s restructuring plan.
“Much of the tremendous progress we have made has been overshadowed by the economic crisis of historic proportions that began last year,” he told shareholders. “We are undergoing the most rapid and far-ranging transformation in our history.”
CEO Alan Mulally said Ford remained committed to matching capacity worldwide to demand and would continue a multi-year program of dealership consolidations in urban areas.
“We are confident that we will not only survive this downturn, but that we will emerge as a lean, globally integrated company poised for long-term profitable growth,” Mr Mulally said, adding that the carmaker was on track to be at or above break-even in 2011 excluding special items.
Ford is the only US carmaker not operating under US government emergency loans and expects to be able to steer clear of the industry collapse now swallowing GM and Chrysler as long as that process is orderly.
The carmaker’s stock was up 36 cents, or 7.3 per cent, at US$5.32 on the New York Stock Exchange after the annual meeting, which attracted 98 Ford shareholders, up from 56 last year.
Ford posted a company record net loss of US$14.7 billion in 2008 and losses have totalled US$30 billion over the past three full years. It posted a first-quarter net loss of US$1.43 billion.
US industry analysts see the Ford debt restructuring, the union agreements and the carmaker’s ability to issue more stock as signs that it could make it through the industry downturn and out the other side without seeking government emergency loans.
The company has completed a debt restructuring, raised US$1.6 billion in cash from a stock offering and reached a deal with the UAW to cut labor costs and reduce its cash obligations to a union retiree healthcare trust.
On the sales front, Ford has seen its US retail market share stabilize over the last several months, albeit with the industry sales running at a roughly 27-year low.