Ford (NYSE: F) will probably sell its Jaguar and Rover units to India's Tata Motors (NYSE: TTM). But the U.S. car company wants to go beyond that and build its own presence in the huge country. Ford will put up $500 million to increase its manufacturing operations in India between now and 2010. It will also develop a small car for sale in the country.

"This new investment highlights the significance of India's role in our continued expansion and overall strategy for the Asia-Pacific and Africa region," John Parker, executive vice president of Ford for Asia-Pacific and Africa, told Reuters.

While India's car market is growing fast, Ford may find that it is a little late to a very competitive game. Large rivals from Europe, GM (NYSE: GM), and Toyota (NYSE: TM) all want a piece of the same market, and India has its own car companies protective of their turf.

GM announced that it hopes to have 75% of its sales overseas in 10 years. Ford probably has similar goals because the U.S. car market is both competitive and slow-growing. But that means that a number of companies are all trying to get share in the same markets -- India, China, Russia, and South America. Ford would not seem to have any big advantage in this race, and its fairly weak balance sheet is not likely to help it expand.

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

Ford plans push into India originally appeared on BloggingStocks on Tue, 08 Jan 2008 08:38:00 EST. Please see our terms for use of feeds.

Now that the UAW contract with Chrysler is all but ratified, the big union gets to sit down with Ford (NYSE: F). In some ways, bargaining with America's second-largest car company may be the toughest negotiation of all. Ford is in worse shape than its peers, and its revenue problems get worse as each month passes.

Ford may be able to afford putting $30 billion into a health-care fund that the union would manage. That would improve the company's earnings in future quarters. But it would also deplete Ford's balance sheet and give it less cash to fund a turnaround of its U.S. operations. Selling off Jaguar or Rover could bring in more capital, but the process to dump the two brands is slow and the current credit environment will not help Ford get a good price.

Ford had hoped that new products would improve its prospects, but its car sales have dropped about 20% in its home market each of the last two months. It is not clear that Ford can ever make a profit if its U.S. sales do not recover from current levels. It needs sharp cuts in its labor costs in addition to a better sales picture.

The UAW can do a great deal of damage to Ford by insisting on modest job cuts. Ford can ill afford a strike now that the other two U.S. car makers have deals and Japanese rivals pick up market share most months. But the union's rank-and-file came close to rejecting the Chrysler contract because it guaranteed too little in terms of jobs and pay in the years ahead.

UAW workers are likely to take the position that it is not their job to keep Ford in business. And that attitude is the most likely one to put Ford's future in harm's way.

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

Ford vulnerable heading into UAW negotiations originally appeared on BloggingStocks on Fri, 26 Oct 2007 06:46:00 EST. Please see our terms for use of feeds.

After hitting a one-year high of $9.70 in June, the stock has sagged a bit over the past couple of months, though it has been moving higher recently. Ford opened this morning at $8.47. So far today the stock has hit a low of $8.36 and a high of $8.59. As of 10:55, Ford is trading at $8.57, up $0.34 (4.1%). The chart for Ford looks bearish but improving slightly, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.

For a bullish hedged play on this stock, I would consider a December bull-put credit spread below the $7 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 7.1% return in just 3 months as long as Ford is above $7 at December expiration. Ford would have to fall by more than 18% before we would start to lose money.

Continue reading Ford (F) higher before General Motors (GM) - UAW deadline

Ford (F) higher before General Motors (GM) - UAW deadline originally appeared on BloggingStocks on Mon, 24 Sep 2007 11:14:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• Prudential initiated the automotive manufacturers industry and automotive retail industry with Favorable ratings and the automotive parts and equipment industry with an Unfavorable rating. The firm initiated coverage on following stocks:
  
• Overweight-rated names included Autoliv Inc (NYSE: ALV), Group 1 Automotive, Inc (NYSE: GPI), Honda Motor Co, Ltd (NYSE: HMC), Johnson Controls, Inc (NYSE: JCI), Sonic Automotive, Inc (NYSE: SAH), & Toyota Motor Corp (NYSE: TM).
  
• Neutral Weight-rated names included AutoNation, Inc (NYSE: AN), DaimlerChrysler (NYSE: DCX), Magna International Inc (NYSE: MGA) and United Auto Group, Inc (NYSE: UAG).
  
• Underweight-rated names included Ford Motor Co (NYSE: F), General Motors Corp (NYSE: GM) and Gentex Corp (NASDAQ: GNTX).

• Bernstein initiated JPMorgan Chase & Co (NYSE: JPM) with a Market Perform rating and $54 target.

• Lehman started Time Warner Cable Inc (NYSE: TWC) with a Neutral rating.

• Merriman initiated shares of Progressive Gaming International Corp (NASDAQ: PGIC) with a Buy rating, as the firm believes it is on the cusp of gaining meaningful market share of casino floors through its technologies and now is the time to get involved in shares.

Analyst initiations 4-04-07: F, GM, JPM and TWC initiated today originally appeared on BloggingStocks on Wed, 04 Apr 2007 11:11:00 EST. Please see our terms for use of feeds.