Ford Motor Co. (NYSE: F) will refit an existing truck plant in Michigan to manufacture smaller cars. Cost: $75 million. This comes on the heels of one of the worst years ever for large American automakers, which still can't cope with rapidly changing consumer desires for fuel-efficient transportation instead of gas guzzling SUVs and large trucks.

As Georges indicated recently, Ford will need massive plant retooling to get its bottom line back in shape as it produces the product mix consumers are looking for. This is a good step for Ford, even though it will be costly. The $75 million price is minor considering the cost of doing nothing.

Ford says the production of newer, fuel-efficient cars at the Michigan plant will begin in a few months, with completion sometime in 2010. It's also moving 1,000 of the employees from that plant to another one in Wayne, Michigan to increase production of the 4-cylinder Ford Focus sedan. Since Ford spent $300 million just three years ago to build the plant to be flexible, this should speed the conversion, according to the automaker.

It's just too bad that Ford can't unveil more small car production in November instead of just starting to convert a plant for a few years down the road.

General Motors (NYSE: GM) and Ford (NYSE: F) want you to pick up their tab for their decades of excess and managerial incompetence.

The Associated Press reports that the Detroit automakers are likely to ask Congress for $50 billion in low-interest loans to fund modernization efforts, and help them build more fuel-efficient vehicles.

What a load of crap. In 2007, Ford paid cash-burning CEO Alan Mulally $21 million, and GM's Richard Wagoner got a 41% raise to over $14 million for the same year. In effect, our tax dollars will be subsidizing this pay for pulse orgy of bad governance. GM also paid out more than half a billion in dividends in 2007 -- if the company needs billions to invest in modernization, why didn't it cut the dividend a long time ago?

It appears that the auto industry has been counting on a bailout all along, and why not? It looks like they'll be getting it.

As expected, Ford Motor Co. (NYSE: F) posted dreadful results. But the numbers were even more awful than Wall Street feared, sending shares of the company plunging in premarket action.

The number three automaker -- at least for now --- posted a net loss of $8.7 billion, or $3.88 a share, for the second quarter including a $5.3 billion write down of its North American auto business and another $2.1 billion charge. A year earlier, Ford had a net profit of $750 million, or 31 cents per share. Revenue excluding special items fell to $38.6 billion compared with $44.2 billion during the year earlier period.

Excluding one-time expenses, the loss was $1.38 billion, or 62 cents. On that basis, analysts had expected a loss of 27 cents on revenue of $34.6 billion, according to Thomson Reuters.

The Wall Street Journal was good enough to humiliate General Motors (NYSE: GM) CEO Rick Wagoner by pointing out that he still has his job. The company's share price is down almost 85% since he took over. The newspaper writes that Mr. "Wagoner's decision a few years ago to tilt GM's product mix more toward trucks and SUVs isn't looking good."

Fair enough. But there are two critical elements to Wagoner still having his corner office. One is that the rest of the US car industry is as bad off as GM, maybe worse. The other is that no CEO in his right mind would leave a good job to take over GM. Boeing (NYSE: BA) exec, Alan Mulally, moved to Ford (NYSE: F) as the head man and he must regret the decision every day.

Wagoner is part of the "dumbing down" of the American CEO. If the man can't do well, blame it on the industry. That makes it seem that individual companies are powerless to make decisions that will put them ahead of the competition, even in tough markets.

Tell that to the guys at Honda (NYSE: HMC).

Douglas A. McIntyre is an editor at 247wallst.com.

"Ford Motor Co. (NYSE: F) recently surprised Wall Street by posting its first profit in ages," notes Mark Skousen in The Turnaround Trader. Here's the advisor's bullish outlook on the auto maker.

"Ford announced a $100 million profit in the quarter, even though sales lagged General Motors and Toyota. I see Ford as a deeply undervalued company that finally is producing good quality cars, both here and abroad, and I don't think higher gasoline prices will have much effect on the turnaround.

"Ford must be seen as a global producer. And foreign sales are booming for Ford and GM. Moreover, now that Ford has decided to include Microsoft's Nuance-powered Sync voice control system in some of its 2008 models, it could help improve sales dramatically here in U.S. showrooms.

"If the profitable quarter continues, Ford now is selling for only 14 times next year's earnings. With revenues of close to $40 billion in the quarter, a smart business person certainly could cut the fat from that and turn a profit, and that is exactly what turnaround specialist CEO Alan Mulally is doing.

"Under his guidance, Ford saved $1.7 billion from cost reductions in the quarter and agreed to sell Jaguar and Land Rover. Wall Street likes what Mulally is doing, and so does billionaire investor Kirk Kerkorian, who is buying its stock. Let's join him by buying Ford."

Each day, Steven Halpern's TheStockAdvisors.com offers the latest market commentary and favorite investment ideas from the nation's leading financial newsletter advisors.

There's also the bearish case: Ford (F): No short seller faith in turnaround

MAJOR PAPERS:

• The Wall Street Journal reported that Ford Motor Company (NYSE: F) CEO Alan Mulally isn't done cost-cutting. According to people close to the situation, Mulally is considering more job cuts, selling its Volvo brand and closing the troubled Mercury brand.
• BHP Billiton Limited (NYSE: BHP) CEO Marius Kloppers strongly criticized Rio Tinto Plc (NYSE: RTP) and its CEO yesterday, the Financial Times reported. BHP Billiton has outperformed Rio Tinto in several areas, including share price appreciation and EPS growth, said Kloppers, adding, "On every metric I can envisage they [Rio] have been beaten."

OTHER PAPERS:

• According to the Economic Times, AT&T Inc (NYSE: T) is reportedly in preliminary talks with Malaysia's Maxis Communications about buying its 74% stake in Indian cellular phone company Aircel, sources said.
• The United Auto Workers union has rejected several "generous" benefit and wage proposals, according to American Axle & Manufacturing Holdings Inc (NYSE: AXL). In a statement yesterday, the Detroit News reported that American Axle said while tentative agreements had been reached on several issues, the UAW "repeatedly rejected" other proposals that were "considerably higher than the market rate."

This post was part of AOL Money & Finance's Best & Worst of 2007. Voting has now closed and, in a close race, readers have chosen Chuck Prince as the best CEO departure of the year. Let us know in the comments if you are pleased with this result.

When looking back at 2007, there were some larger-than-life CEO departures that semi-rocked the business world and brought some investors to the realization of over-the-top compensation yet again. Let's look at a few and then you can decide the winner. Sound good?

First up comes Bill Ford, Jr., from the automotive industry. Under Ford's leadership, Ford Motor Co. (NYSE: F) lost its way in terms of correctly forecasting what kind of vehicles customers actually wanted, in addition to becoming horribly leveraged. As soon as gas prices began shooting up, Ford Motor started spiraling down. Long-time Boeing Co. (NYSE: BA) executive Alan Mulally was brought in to replace Ford as the automaker's CEO just in the nick of time. Ford Motor's expected profitability date with Ford now gone: 2009.

How about Bob Nardelli, formerly CEO of Home Depot Inc. (NYSE: HD)? Nardelli made global headlines by making tens of millions while leading Home Depot shares to the basement and apparently making all kinds of bad decisions that finally led to his ouster this year. On top of that, his severance package made a Brad Pitt paycheck seem like pennies, and Home Depot shareholders paid for it. Did Home Depot stakeholders get a voice in this corporate travesty? A small one, perhaps.

MAJOR PAPERS:

• Merck & Co (NYSE: MRK) announced this morning that it has agreed to pay $4.85B to settle a majority of the 27,000 claims related to Vioxx, its painkiller drug, reported the Wall Street Journal (subscription required).
• In a tough sales environment, Chrysler will next month offer a new series of incentives and rebates, reported the Wall Street Journal. The campaign could put pressure on General Motors (NYSE: GM) and Ford Motor Company (NYSE: F) to follow suit.

OTHER PAPERS:

• The Detroit Free Press reported that Ford CEO Alan Mulally said that the company would lay off more workers. "We will continue to reduce our employment consistent with our restructuring," Mulally said during the company's Q3 conference call yesterday.
• New Blockbuster (NYSE: BBI) CEO Jim Keyes is aiming to transition the company to a retail store from a rental service, reported the New York Post
• The New York Sun reported that the default rate among condominium owners in some of New York City's wealthiest areas is rising by as much as 25% this year, according to lawyers for condominium boards.

Though the United Autoworkers Union's threat to strike Chrysler LLC tomorrow got the headlines today, the union's biggest challenge ahead lies with Ford Motor Co. (NYSE:F).

As Daniel Howes of the Detroit News points out, Ford is hoping to get a better deal than the agreement the UAW recently reached with General Motors Co. (NYSE: GM) because of the automaker's "more dire financial circumstances." UAW head Ron Gettelfinger has spent most of his career representing Ford workers and is close with Ford Executive Chairman Bill Ford Jr., with whom he's been speaking with almost daily for the past month, according to Howes.

Ford Chief Executive Alan Mulally is well-regarded on Wall Street but he certainly has his work cut out for him. Earlier this year, the Dearborn, Mich. automaker unveiled a major restructuring which included the elimination of 25,000 to 30,000 jobs. Pundits including Howes say more job cuts and plant closings are possible. Last year, Ford posted a record deficit of $12.6 billion.

Whether the close ties between Gettelfinger and Bill Ford will help avoid labor trouble remains to be seen. For now, the UAW is focusing its attention on Chrysler.

A Chrysler spokeswoman told the AP that the automaker remained optimistic about a settlement. The timing of the UAW's ultimatum was interesting considering that five U.S. Chrysler plants were going to be shut down anyway for about two weeks starting today because of lower demand for Chrysler products.

Ford Motor Co.'s (NYSE: F) Alan Mulally has wasted no time in the last year as Ford's CEO in trying to right the ship of one of the world's largest automakers. He's severed ties with a whole slew of employees, closed facilities, and has somehow stepped up with a few design wins; most notably, the huge-selling Ford Edge small crossover (CUV). But that's just the beginning.

Ford's financial woes have and will continue until sometime in 2009 as Mulally slices and dices his way through the complete mess he inherited from former CEO and grandson of the company's founder, Bill Ford, Jr. Part of any restructuring is finding pieces of the company that one can lop off; that is, those that are non-core. Some of those large pieces happen to be Ford's European brands like Aston Martin, Jaguar and Land Rover. Aston Martin's already been taken care of, so that leaves the latter brands to sell off, and Ford now says it has four companies in line to bid.

Ford Motor Co. (NYSE: F) is slated to release Q2 earnings tomorrow morning at 9 am EST. Investors hope the results will show some strength for the world's third largest automaker on sales of its smaller Edge crossover and fleet vehicles. The automaker needs some good news to ensure its "Way Forward" plan under the helm of CEO Alan Mulally is moving forward according to plan.

Ford is still going to post some huge quarterly losses before beginning to make gains into the land of profitability sometime in 2009, according to Mulally. Until then, the company will continue reorganizing its business and paying huge operating expenses while it sets itself up to be more flexible and in-tune to customer demands that can shift almost immediately based on housing and gas prices. Those never fluctuate, right? Heh.

The automaker lost just over $12.5 billion last year and posted a loss of $282 million during Q1 this year, so the bets are on in regards to how large Ford's loss will be this quarter. Estimates range from $0.36 to $0.73, but given the enormous scope of changes in Ford's immediate backyard at the moment, I'm not sure any crystal ball could be an accurate predictor of any upcoming Ford quarters at this point. Stay tuned tomorrow morning to BloggingStocks, as I'll be live-blogging the automaker's Q2 conference call.

Ford Motor Co. (NYSE: F) CEO Alan Mulally has a grand master plan to return Ford back to profitability by 2009, and he's making tons of cost-cutting and marketing moves to get there. Even with former Boeing exec Mulally at the helm, turning around Ford is no easy task seeing as that the company just had one of the worst years in its entire history. Too many workers, too many factories, not enough sales and an incorrect product mix. Add all that together along with the inability to react fast enough to market changes and Ford set itself up for failure.

Part of Mulally's plan to get Ford back on track is the "rightsizing" of the employee base. The CEO would like to see the number of employees more closely aligned with the needs of the company. He wants to ensure the right employee base can get the right amount of vehicles -- that customers want -- out the door and onto dealer lots just as demand materializes. So far, about 27,000 hourly workers have left Ford in the last year, with most of them having accepted buyout and early retirement packages. This was planned, of course, and the retirement and buyout strategy has worked well for Ford. Right now, there are about 10,000 workers left at Ford who signed up for the early retirement packages but who have yet to leave the company (a total of 37,00 employees signed up for it).

Mulally's "Way Forward" plan is set to take Ford into the future using long-term vision and ultimate flexibility, and so far the CEO is getting there as well he should be (seeing as the board granted him more than $17 million just to recruit him for the job before he had done anything). So far, Ford investors are probably liking what Mulally has done to get the Ford ship turned around, although there is much work to be done. If current results are any indication, it's already doing a good job with its products.

Ford Motor Company (NYSE:F) has had a rough time lately, but the automaker is making several changes under new leader Alan Mulally to ensure that it doesn't lose a few billion again in any quarter. While both General Motors Corporation (NYSE:GM) and Ford have been under assault in recent times for not reacting soon enough to rising gas prices and the slowdown in SUV sales, GM has weathered the storm a little better than Ford, which has gotten slapped hard in recent times and had one of its worst quarterly performances ever in its last reporting period.

But maybe the sunlight is starting to shine a tad on Ford's fortunes. Credit Suisse Group upgraded its rating on Ford late last week and even forecast that its loss would narrow. No profit is on the horizon yet for Ford (maybe in 2009), but at least "narrowing your loss" gives us some good news out of Detroit, yes?

Instead of losing over $2 billion per quarter, the automaker is expected to report a pretax loss of $1.4 billion to $1.5 billion for the first quarter of its new fiscal year, according to Credit Suisse analyst Christopher Ceraso -- who, incidentally, estimated a loss of $1.7 billion previously. He raised his rating to "neutral" from "underperform." It was at least the fourth analyst upgrade of Ford since December.

Will Ford soon sell the Aston Martin division as some investors and analysts have been clamoring for the past several years now? Pressure to sell off low-performing divisions has increased in recent quarters as CEO Bill Ford stepped down and former Boeing exec Alan Mulally came aboard to turn things around. He had the big job of getting Ford back into profit-making mode after the automaker posted some of the most disastrous results in its history in recent times.

Rumors circulating around this week's Geneva Auto Show say that Aston Martin may be sold by tomorrow (Friday). In fact, a "senior course" said that "It's a done deal. All that remains is to cross the t's and dot the i's." The new owner of the luxury car icon would most likely be a consortium of business interests from America and the Middle East, as opposed to an existing global automaker according to rumored reports.

The price Ford has apparently already settled on is rumored to be only half of what it was asking just six months ago, which may make the Aston Martin division somewhat of a bargain to the buyer. Is it a sign of an incredibly wasteful business decision that Ford lowered the asking price so drastically in recent times? Maybe it should have just sold the brand in a garage sale for a nickel or something.

Ford Motor Co. (NYSE: F) opened at $8.20. So far today the stock has hit a low of $8.19 and a high of $8.38. As of 11:05 this morning, F is trading at 8.36, up 0.13 (1.6%).

After hitting a one year high of $9.48 in September, the stock has seen some sharp ups and downs over the past several months. New Ford CEO Alan Mulally won praise and applause from dealers at this weekend's National Automobile Dealers Association conference in Las Vegas. The NADA also reported at its annual conference that it expects 2007 auto sales to remain flat from 2006, but truck sales to increase. Such an increase in higher-margin truck sales could be a tall glass of cool water for a Ford thirsty for good news. The technicals for F have been neutral but are rapidly improving recently and S&P gives the stock a 3 STAR hold rating.

For a moderately bullish hedged play on this stock, I would consider a September covered call on F at the $8 level.

Brent Archer is an analyst on the move at Investors Observer. DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about.