Tag Archive | "Ford Motor Co."

Americans Saying ‘No’ to Toyota; Ford Most Popular

Americans are turning against Toyota Motor Corp. after sudden-acceleration complaints forced it to recall more than 8 million vehicles worldwide, while Ford Motor Co. is the most popular automaker, Bloomberg reported.

More than four in 10 Americans say they “would definitely not buy a Toyota,” according to the Bloomberg National Poll. The Japanese company is viewed unfavorably by 36 percent of those interviewed, the highest negative rating in the survey, while fewer than half — 49 percent — have a favorable impression.

Ford, the only U.S. automaker that didn’t seek a federal rescue, is seen favorably by 77 percent of those surveyed, topping No. 2 Honda Motor Co. by seven percentage points. General Motors Co., eight months after getting U.S. aid to survive, has a positive rating of 57 percent.

The results show the challenge faced by Toyota, which in 2008 passed GM to become the world’s largest automaker, as it tries to regain consumer confidence, said Rebecca Lindland, an auto analyst at IHS Global Insight in Lexington, Massachusetts.

The poll found that the older the respondent, the less likely they were to have a positive opinion of Toyota: 37 percent of people over 65 see the company favorably compared with 51 percent of those under 35.

The Toyota City, Japan-based company is using no-interest loans and lease discounts to coax back buyers after its U.S. sales dropped 12 percent in the first two months of this year. The incentives have helped boost sales as much as 44 percent in March from a year earlier, said Dave Cutting, senior manager of North American forecasting for J.D. Power & Associates.

Toyota’s share of U.S. vehicle sales in February fell to 12.8 percent from 15.9 percent a year earlier, according to data compiled by Bloomberg. Ford Chief Financial Officer Lewis Booth said “it’s far too early” to say if those market share losses will be permanent.

“They’re a formidable company with formidable resources and with a stellar track record of building their brand,” Booth said yesterday in an interview. “You’d be foolish to count them out.”

Ford, which avoided the bankruptcy that hit GM and Chrysler Group LLC, returned to profit last year and gained U.S. market share for the first time since 1995. Its market value has increased almost fivefold in the last 12 months.

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Ford Sees More Gains in U.S. Market Share in March

DETROIT – Ford Motor Co. expects to take a larger share of the U.S. market in March, as it continues to attract non-Ford owners to its brands, Ford’s U.S. sales chief said today, Reuters reported.

The U.S. auto industry overall is expected to have a stronger month in March than many expected at the end of February, but Ford’s results should outpace the industry, Ken Czubay said in an interview.

“We are having a pretty good month in March and we are finding the industry is having a good month, but we ought to outpace the industry again,” he said.

Czubay said the seasonally adjusted annualized sales rate for the industry in March will be “surprisingly good” compared with what might have been expected at the end of February.

In early March, Ford said consumer confidence seemed to have reached a plateau.

Annualized U.S. auto sales ran at a 10.8 million vehicles in January and at about 10.4 million in February. Most industry forecasters expect sales of about 11.5 million vehicles in 2010.

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Ford's Cash Needs, ‘Fragile’ Economy Hinder Dividend Restoration

Ford Motor Co., which rose to the lead in U.S. auto sales last month, still must contend with the possibility of a “fragile” economic recovery and won’t restore stock dividends soon, according to Chief Financial Officer Lewis Booth, Bloomberg reported.

Ford ended three years of losses in 2009 with net income of $2.7 billion and forecasts a pretax operating profit this year. The Dearborn, Michigan-based company passed General Motors Co. in February to lead U.S. monthly auto sales for the first time since 1998.

“There are some hurdles ahead of us and the most obvious hurdle is, how fragile is the economic recovery?” Booth said. Ford is planning for a “modest recovery,” he said.

Ford is unlikely to soon bring back dividends on its common and preferred shares because “we still have huge demands on our cash,” Booth said. “I wouldn’t want to raise people’s expectations or hopes.”

The last payout on the common shares was Sept. 1, 2006. Ford hasn’t paid a dividend on its Capital Trust II preferred stock since Jan. 15, 2009, and has said it would defer payments for as long as five years.

Ford forecast U.S. industrywide sales of 11.3 million to 12.3 million cars and light trucks this year, rising from 10.4 million in 2009, which was the lowest since 1982. The annual average from 2000 to 2007 was 16.8 million.

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Ford's Mulally Earns $18 Million

DEARBORN – Ford Motor Co. CEO Alan Mulally’s 2009 compensation package totaled nearly $18 million, including stock options and grants, the company reported.

Mulally’s compensation was $1 million more than he received in 2008, even though he got less cash because of a voluntary reduction that dropped his cash pay from $2 million to $1.4 million, reported The Detroit News.

Ford swung back to a profit of more than $2.7 billion last year after years of staggering losses. So, most of Mulally’s pay increase was a reflection of the increased value of the company’s stock, which traded at about $8.50 a share when he was hired in September of 2006 and closed at $13.99 a share Monday

“When CEOs take a lot of stock, you can’t complain because they’ve got to ride it up and ride it down just like the shareholders,” said turnaround expert Van Conway of Conway MacKenzie Inc. in Birmingham.

“At $14, it’s hard not to give the quarterback a little credit here. Ford avoided a bailout. They avoided bankruptcy. And shareholders would have lost everything if they had filed.”

By comparison, General Motors Co. Chairman and CEO Edward Whitacre Jr. this year will receive a compensation package worth $9 million.

The United Auto Workers also has been a big beneficiary of Ford’s rising share price.

Last February, the union received 362 million stock warrants with a $9.20 a share strike price that made them all but worthless — then — as part of a deal to take over responsibility for hourly retiree health care. At today’s prices, however, the UAW has netted more than $1.5 billion.

“Compensation typically goes up when companies are profitable,” Conway said.

One person who has yet to receive any increased rewards is Executive Chairman Bill Ford Jr., who has been working without compensation since 2005.

Ford spokesman Mark Truby said Bill Ford, the great-grandson of Henry Ford, will continue to forgo compensation “until the board determines we’ve achieved automotive profitability for a full year.”

When that happens, his total compensation for 2009, including stock options and grants, will be $16.8 million.

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Geely Says Volvo Talks Hit Snag

BEIJING — China’s Zhejiang Geely Holding Group Co. Chairman Li Shufu said he continues to expect to complete Geely’s effort to acquire Ford Motor Co.’s unprofitable Volvo unit but indicated the talks have hit a snag because of unspecified problems at Ford, The Wall Street Journal reported.

Li said the automaker has “done everything [it] can to prepare for the deal in accordance with the framework agreement” the two auto makers signed in December to allow Geely to acquire Ford’s Swedish brand. The ball is now in Ford’s court, he indicated.

“We’re ready to seal the deal,” Li said on the sidelines of a ceremony to launch cooperation in automotive talent development between Geely and a company-affiliated university in Beijing. “If the deal fails, the problem is not on our side. We have not violated any part of the agreement.”

Li said he still expects to complete the deal, but his tone was cautious. “The situation is changing constantly…and the process of the negotiation is very tough,” he said as he sat for a break between speeches at Beijing Geely University. “We will put as much effort as we can. I hope the deal can be done.”

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Ford Shares Hit 5-Year High as Moody’s Raises Rating

March 17 – Ford Motor Co. rose to a 5-year high in New York trading and its bonds gained after Moody’s Investors Service upgraded the automaker’s credit rating, reported Bloomberg.

The company’s shares climbed 61 cents, or 4.5 percent, to $14.10 at 4:15 p.m. in New York Stock Exchange composite trading, the highest close since Jan. 12, 2005. Its $1.8 billion of 7.45 percent notes due in 2031 rose 2.5 cents on the dollar to 92.5 cents, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.

Moody’s raised Dearborn, Michigan-based Ford’s corporate credit rating one step to B2, the fifth level below investment grade, from B3, according to a statement today from the New York-based ratings company. The upgrade also included the Ford Motor Credit finance unit and affects about $65 billion in debt.

“Ford clearly has a much more robust and competitive business model,” Bruce Clark, Moody’s senior vice president, said in the statement. “The key issue we’re assessing is the degree to which this pace of improvement could be delayed by things like a slowdown in demand or an escalating use of incentives by competitors.”

The ratings of Ford and Ford Motor Credit are on review for further upgrades, Moody’s said.

“The stock trading up is just confirmation that Ford is doing all the right things,” said Shelly Lombard, a debt analyst at Gimme Credit LLC in New York. “Toyota is stumbling and GM still isn’t on track yet, which is all positive for Ford.”

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