Just when it looked like things might be going right at Ford (NYSE: F), it may be going wrong again. The company, which reported a better third quarter than Wall Street expected, said that a bad U.S. economy might drive sales down and force the company to cut production on some vehicles. The No. 2 car maker has faced double digit sales declines in most of its monthly reports this year.
In statements picked up by Reuters, Ford CEO Alan Mulally said, "The business environment has clearly gotten tougher. It's gotten tougher and we want to be ready to move if we need to."
The comments cannot hearten the UAW, which just gave Ford a nifty new contract. Lower production and idling of plants generally means layoffs. The UAW may have won a big battle, but part of the war now still appears to be ahead.
Ford has reached an interesting tipping point. If it is going to compete with other large car companies in the U.S., it needs to have a full line of cars and light trucks. It also needs to have the capacity to increase production when the markets begin to improve. Ford may cut more workers, layoff more managers, and stop production at more facilities. But at some point, it is only half a car company by size. And that means an end to Ford as it has been known for almost 100 years.
Douglas A. McIntyre is an editor at 247wallst.com.
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Reader Comments (Page 1 of 1)
11-14-2007 @ 2:47PM
Rick S said...
>>>>But at some point, it is only half a car >>>>company by size. And that means an end
>>>>to Ford as it has been known for almost >>>>100 years.
I read this as a positive. Forget about size and look at profitability! Keeping the same size (as their market share shrunk) has been the curse of the big three. Remember DaimlerChrysler that kept pumping out cars even though their were no orders. I'd rather have them in a position of not having enough capacity versus to much.
11-14-2007 @ 2:09PM
Chris said...
Part of Ford's problems is the boycott by supporters of the AFA. (American Family Assoc.) Ford chooses to actively and agressively support the gay agenda rather than remain neutral in the culture war. The only power most of us have is with our checkbooks and I'm joining thousands of others in voting "No Ford for me".
11-14-2007 @ 6:28PM
Eric said...
Hey Chris, news flash. Every car company from Toyota to Hyundai supports diversity and spends money on gay friendly causes. It's posts like yours that make me want to go out and buy a Ford for every member of my family. I say boycott the conservative Christian agenda! Christ was not a Republican. He loved all people to much for that.
11-14-2007 @ 6:57PM
Rick S said...
Well said Eric.
11-15-2007 @ 11:32AM
sl said...
Point of fact Thomas:
Gay people are screened from blood donations.