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Ford earns $2.7B in 2009, first profit in 4 years

January 28th, 2010 . by TexasFred

Ford earns $2.7B in 2009, first profit in 4 years

DEARBORN, Mich. (AP) – Defying economic conditions that sent its U.S. rivals into bankruptcy court, Ford Motor Co. clawed its way to a $2.7 billion profit in 2009 and expects to stay in the black in 2010. It was the automaker’s first annual profit in four years.

Ford’s full-year revenue of $118.3 billion fell 14 percent from 2008, but the Dearborn-based automaker benefited from $5.1 billion in cuts to manufacturing, engineering and advertising and a $1.3 billion profit at Ford Credit. It gained market share in North and South America and Europe despite the worst U.S. sales climate in 30 years. Share in Asia was flat.

Ford CEO Alan Mulally said 2009 was “pivotal” but Ford has work to do.

“Ford’s transformation remains a work in progress and is far from complete,” he said in a conference call with analysts and media. Back in 2006, Ford was considered the weakest of the three domestic automakers.

Full Story Here:
Ford earns $2.7B in 2009, first profit in 4 years

Maybe Ford really DOES have a Better Idea! Remember that slogan?

GM and Chrysler took federal bailout money. Have they shown a profit? Of any kind? I can’t find any data that says PROFIT made. But I did find this, a promise of profit.

DETROIT (CNNMoney.com) — General Motors Chairman and CEO Ed Whitacre promised Monday that taxpayers will make a profit on the $50 billion that Treasury has sunk into the company over the past 13 months. SOURCE

A $50 BILLION bailout from the government, and so far, we get a promise from GM?? That’s about all we’re going to get from Chrysler too I’m afraid.

On June 10, 2009, the sale of most of Chrysler assets to “New Chrysler”, formally known as Chrysler Group LLC was completed. The federal government financed the deal with US$6.6 billion in financing, paid to the “Old Chrysler”, formally called Old Carco LLC. The transfer does not include eight manufacturing locations, nor many parcels of real estate, nor equipment leases. Contracts with 789 U.S. auto dealerships, who are being dropped, were not transferred. SOURCE

Some sources are saying that IF Chrysler is able to show a profit at all, it will likely be sometime in 2010, if it happens. According to Chrysler CEO Sergio Marchionne, “Chrysler can be profitable this year if its sells 1.1 million vehicles in the U.S. and 1.65 million worldwide.”

Those sales targets represent an 18% improvement over Chrysler’s 2009 U.S. sales and a 27% jump from last year’s global total, both tall orders given that most industry leaders say they expect U.S. sales to rise about 10% this year to 11.5 million. SOURCE

I’m not a business major, but even I know that those sales figures are unrealistic in todays down economy. Unemployment is at least 10%, that’s what the government is willing to admit to. If the truth were told, those figures are several points lower that the actual number that makes the news. Americans aren’t going to buy enough Chrysler automobiles to cause that needed spike in sales. I know that I personally wouldn’t buy a Chrysler product.

I have to wonder, if Ford is doing so well, while GM and Chrysler are still struggling, where do you suppose Ford would be if they had taken federal bailout funds? I am guessing they would still be in financial trouble with no end in sight! Bailouts were handouts, on a massive scale, and handouts rarely help the recipient past some small, but immediate relief.

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