Tech & Biz

Ford posts surprise $750m profit

by ryan | July 26, 2007 at 08:52 am

1204 views | 24 Recommendations | 2 comments

This is the first good news to come out of the US car industry in years...and it's interesting to note that as Ford announces this positive result it also announces it is considering selling some of its other brands. You'd think the fact it made money this quarter would suggest that the business plan was working. However the fact that the profit is attributed to the sale of Aston Martin and other cost cutting measures, suggests that further sales will only increase profits and allow Ford to focus on its core brand.

US carmaker Ford has posted its first quarterly profit since 2005, crediting cost-cutting and the sale of its Aston Martin business for its progress.

It made $750m (£367m) between March and June, as against a loss of $317m in the same period a year ago.

The news came as Ford said that it was talking "in greater detail" to parties interested in buying its UK Jaguar and Land Rover divisions.

Analysts believe a private equity buyer is most likely to buy the marques.

Ford did not name the contenders, although they are thought to include India's Tata Motors.

It also said that a strategic review of its Volvo business would probably be completed by the end of the year.

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prajpix

flagged this story as Good Stuff

at 16:39 on July 26th, 2007

Ryan Nadel, I like this story. It's good stuff.

babblingdweeb

flagged this story as Good Stuff

at 13:09 on July 27th, 2007

Good stuff and good news for Detroit...but only if Ford can maintain a good plan. hiring Alan Mulally was a step in the right direction for many reasons...for starters, Ford Motor needed to change and Bill ford could not pull off what the company needed. Without debating when he should have stepped off the board, I have to give him a lot of credit to be humble enough to step down (or out of the line of fire) and give the captain's hat to a non-family member.

Mulally has proved himself before and his skills in turning around a company. While unfortunate to let brands go, if they are not profit centers -Ford needs to let them go. They are not in the financial position to hold onto losers or break-even brads when the Detroit economy is not forgiving to automotive companies -let alone anyone.

Job-cuts and cost cutting measures helped them post a profit, but I have some concern over the leveraged plant assets to pay out employee packages; not to mention grave concern over rescinding of packages. --There needs to be more news on this topic in the MsM.

It will be interesting to see how the next few months pan our for Ford. I hope they can continue to make appropriate strategic decisions to save their core brand and the company. Detroit does not want to see them go away.