Ford “on track” to end losses in 2011
May 16, 2009 by David Twomey
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.
Print it: 
Great to see a good news story. I think we are all a little tired of the doom and gloom reports coming through on car companies, share markets, housing, and job losses. Not many reporting the good planes landing at the moment.
WELL DONE FORD AND Mr Mulally :-) here for the long haul
If Ford US get the Euro Fiesta and Focus, imagine how many more cars they will sell. Add the Falcon as their large RWD sedan to the focus, fiesta, mustang, transit, F-series, and even the Fusion, and what a vehicle line up.
Acfsambo
Isnt Ford opting to globalize FWD on their “large” cars… as this is part of them “saving money”?
Not sure.
Lukaas, Ford is Globalising yes. However Teh fate of RWD is still undecided. As has been said on numerous occasions, Ford are looking at what the market wants. THey have a reqiurement for RWD (Stang) but if the buying public in Australia were to suddenly dump the Falcon in Favour of say Aurion or Accord, then they would definatley look at changing. Until then whilst we are still outselling them in the Family car market Ford wont change.
Overall, a pretty good/balanced article. Another positive news story for Ford which most likely wont make ‘drivel’ or ‘carpguide’ because it doesn’t suit their agenda.
The last paragraph was in fact wrong. Ford have gained market share for 6 of the last 7 months.
Ford are also planning to increase production in Q3 by as much as 25% after making their righsizing at the right time.
With the number 1 & 3 selling cara in Europe (Fiesta & Focus) and plenty of great vehicles worldwide, they will emerge stronger, leaner and more profitable than ever.
Great work Mullaly!
Falcon will not go to FWD. Alan Mullaly himself has said that.
The Falcon I6 (the intelligent six) plant will continue to make that powerplant until 2013 at a minimum and most likely 2015. That motor doesn’t suit FWD, only RWD.
Add the number of Falcons (sedans, wagons and utes) plus Territory and they are lineball with Commodore numbers.
Focus in 2011 is to be built here too.
Oh and the gap from C’dore to Falcon is now under a 1000/mth. C’dore is down 14%, Falcon up 20%. With 9.9L economy for Falcon and the uncertainty of GMH parent, plus a push by Ford Aus president Burella that gap is really consistently closing.
Ford will begin to outsell Holden on a monthly basis by years end. The monthly gap has reduced from 3,000 to 1,000.
Good luck to all Aussie manufacturers. Ford Aussie Built for 85yrs and counting. 25 more than Holden, 40 more than Toyota.
PhilC,
You are correct, the falcon sedan sales arent trailing the commodore by much at all now, and what it is trailing by is topped up by ford selling more falcon utes than commodore equivalent. Im not sure what current Terry figures are at, but Id reckon it would be near enough to making ford the number one in selling local products…..
Oh and just to rub salt in, Ford is doing this without Congressional Bailouts in the US and with way less Govco handouts in Aust. Rmember that Focus was announced without Govco money unlike Camry electrical or Cruze……..