By on January 23, 2011

On Friday, Ford will show something it didn’t have for a long time: Money, and lots of it. The Freep thinks that Ford will report a profit for 2010 of about $8 billion excluding onetime charges. That would be the biggest annual profit Ford saw in a decade.

And what’s that nasty “one time charge?” It will be $960 million, resulting from the elimination of about $1.9 billion in debt. Even with the charge, $7b in cash is nothing to sneeze at. Ford will be able to hold on to that money, the taxman will have to wait until the loss carry-forwards (Ford lost $30 billion from 2006 to 2008 alone) are used up. Ford expects to finish the year with more cash on hand than its remaining $21 billion in automotive debt.

However, there is danger ahead. Ford’s labor contract with the UAW expires in September. And they will want some of that profit.

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19 Comments on “Ford To Announce Record Profit...”


  • avatar

    Good news. Hope they continue on the right track.

  • avatar
    DeadFlorist

    Meanwhile, at Chrysler:  http://www.youtube.com/watch?v=0HEW5bXqKbU

  • avatar

    Some free advice for Ford — start the PR war against the UAW right now. Don’t wait for September.
     
    Make this an “us versus them” battle in the court of public opinion. (Remember, opinion of the UAW is at an all-time low, whereas Ford has significant gravitas for avoiding the bailout.) Remind lawmakers and the general public alike of the union’s role in the near-deaths of GM and Chrysler, and very nearly Ford. Make it clear you support your workers… but not their corrupt organization.
     
    In addition to further weakening an already gasping UAW, tell me an approach like that wouldn’t sell a few more Fusions and Explorers, too…

  • avatar
    Educator(of teachers)Dan

    Please, Lord, don’t let the UAW shoot itself in the head during negotiations.  One of the three patients is finally showing some signs of improvement, that doesn’t mean it’s time for Ford to have do donate blood. 

  • avatar
    GS650G

    This is great, I’m glad I bought months ago and in addition to the stock price rise I should see some dividend gravy. I’ll have to sell before the UAW decides they are entitled to a pay increase.
    Maybe the auto czar will decide Ford’s profit is collective in nature and needs to be spread around anywhere the poor UAW hangs it’s hat. There are several subtle and not so subtle ways of accomplishing this.

    • 0 avatar
      Aircooled Poirot

      Ford is paying a $960 million premium to eliminate $1.9 billion in debt?  They must have been issued at something like 20% rate. 

      BTW, $7 billion in net income does not imply $7 billion in cash flow.  There is also property, plant and equipment costs, depreciation, amortization, etc. 

  • avatar
    SV

    Perhaps my memory is faulty but I remember Toyota posting a $10 billion profit a few years back, and that was lauded as the biggest profit ever posted by a car company. If anyone had told me at the time that Ford would be able to post numbers in anywhere near the same league by the end of the decade I’d have laughed in their face. Really great performance by Ford, let’s (hope the UAW lets them) keep it up…

  • avatar
    NormSV650

    Sounds like $5000+ bonus time!

  • avatar
    pgcooldad

    Ford stock is making a lot people a lot of money at Chrysler.

  • avatar
    gslippy

    If Ford was an oil company, there’d be hearings on Capitol Hill about their ‘excessive’ profits.

  • avatar
    John Horner

    Can we declare the Ford Death Watch series over?
     

  • avatar
    kkt

    Cool.  Do they have their logo out of hock yet?
     

  • avatar
    PeteMoran

    I just wanted to comment on the inclusion of a great Pink Floyd number from the greatest album ever.

  • avatar
    Z71_Silvy

    Ford also announced a year ago that Mercury was alive and Ford was committed to it with Big Al saying:
     
    Speaking at the Washington Auto Show, Mulally reportedly said, “That’s our plan – to continuously improve the Mercury and Lincoln brands,”
     
    Don’t believe anything Ford says.  They are liars.

    • 0 avatar
      Silvy_nonsense

      Smart businesses change their decisions as market conditions change. Only a fool makes a decision and sticks to it no matter what, regardless of what happens over time. Good managers constantly re-evaluate their assumptions and conclusions to make sure they still make sense in the face of new data and changing circumstances.
       
      Detroit ignored changing reality for decades and it brought them nothing but loss of market share, lackluster products and a reputation for mediocrity. I commend Ford for making hard decisions and having the guts to carry them through. Go Ford!

      Edited to add: Go GM! and Go Chrysler! I want them all to succeed. If you want to act like an immature fan boy and do some brand bashing or make a lame attempt to discredit a smart, successful CEO how about you pick a real “enemy” like Tata or BYD and their leadership?

    • 0 avatar
      Z71_Silvy

      discredit a smart, successful CEO

       
      Now that was funny!

  • avatar
    Sinistermisterman

    I won’t Silvy, I’ll believe everything you say instead.

  • avatar
    obbop

    Old Coot Contemplation;
    Ford corporate entity and common workers agree to initiating some sort of “slush fund” for future use to ensure the firm can handle unexpected economic troubles, downturn, unexpected costs, whatever.
    Gotta’ keep the firm alive if jobs are to remain.
    Perhaps decide upon a set amount for a slush fund and invest it as wisely as possible for the good of all involved.
    Use investment proceeds to pay taxes owed from the invested funds and then equitably distribute the proceeds among the workers… perhaps with a cap for those earning what? Over $250,000 yearly not eligible for the yearly payment from the slush fund’s after-tax profits?
    Just pondering about what may not be a feasible process.
    But, a possible incentive for employer/employee relationship and a possible incentive for the average workers to feel as being a wanted and needed part of the firm.


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