One of Ford’s Chief Engineers recently stated that “no economist predicted the economy to be as bad as it is or that the cost of fuel would be this high” in response to concerns about the apparently ‘delayed timing’ of focusing on small car. Well, he and I surely read different materials…

If the heads within Ford could not forsee $4.00 per gallon fuel I’d not bet that they can forsee $7.50 per gallon fuel, either. Time will most assuredly tell though won’t it?

Even UAW Chief Ron Gettelfinger admitted that Ford would not make any money on the Fiesta if it were to be built here; hence the UAW hasn’t kicked up too much of a fuss over the decision to build it in Mexico.

The key is what Ford does with this cost advantage. If it uses it to add more content to the car to better compete with the Fit, it will have a winner that will change the public’s perception of what a small Ford is. If it builds another stripper fleet special, Ford will ultimately end up right back where it started…

It’s funny that Toyota and Honda can build small cars in the US and Canada, including Corollas using UAW labor, while turning a profit.

We need to realize that the argument that small cars aren’t profitable was always a lie, one that was made to blame labor for management’s own inefficiencies and to conceal structural problems within these companies themselves.

The real challenge for Detroit is to build cars that are good enough that customers are willing to pay real money for them. Detroit’s extreme use of incentives and the fleet market were not part of a business strategy, but a reflection of the inadequacy of the product.

Whether Mulally can fix this remains to be seen. The plan is to build the Fiesta in Mexico, which will lower their labor costs. Using a design common to Europe will lower their R&D costs, and should improve their economies of scale.

The real challenge for Ford will be to make the car good enough that customers will willingly pay as much for it as they would for a competitor. That remains an unknown, and product quality and Ford’s ability to convince the public to trust the brand will determine that outcome.

I’ll forgo giving any tips here as I”m really not qualified, but after reading everything, and beleiving the oil bubble will burst (while at the same time hoping American consumers won’t go back to previous buying patterns) I say buy Ford!!!

From a pistonhead point of view…Ford is my favorite American car maker. I have had 3 Ford cars (out of a total of 10) in my life, being the last one, a Ford Ka, a POS. In spite of that, I’d still give the company one last try (as the 2 previous ones were ok). When I was a kid I’d insist with Dad to buy a Bronco (he never did) and one of my dream cars is still the Mustang circa 65.

As far as GM goes, we had some of their cars in the past, very far away past, make that like at least 20 years. Problem is, they are so outdated down here, for a pistonhead family they are not even in the picture. Seriously, in my immediate family no one has a car of theirs or thinks of buying one. For me, to be honest, GM, curl up and die already.

Chrysler is interesting from a design point of view but they don’t really exist down here.

So Ford, Here’s one for you! I count on you to continue the great Amrican tradition when building cars. You have a fan in me.

This seems to be more of a reaction to the banking stocks. Ford is not a big piece of the Dow, and couldn’t possibly drag it down that much by itself.

I noted above the issue of 2nd quarter numbers being a potential factor. The question is whether the current price or something close to it has already been dialed into those numbers.

I think that everybody already knows that 2nd quarter is going to suck. Whether that’s completely accounted for in the price is debatable. Since Ford has no earnings, there is P/E ratio to work with, the price is going to naturally be somewhat arbitrary by default. How arbitrary it is exactly is hard to say.

And trying to time absolute bottoms or tops is very tough, for anything. If you always try to do it perfectly, then you’ll never buy anything. The idea is to make a profitable pick, not to squeeze every single penny from that pick.

Regardless, you may want to hang onto your cash for a bit…

“If every crazy guy could fly we’d have a permanent eclipse?”

The problem with that may be that it might be a little late by then. We’ll see.

I see that F is diving today, in sympathy with the Dow falling. It’s hard to call, but I could see the Dow going below 11,000. If that’s the case, it might be smart to wait until then…assuming that one can predict the Dow with such confidence.

If you don’t see those as being the alternatives, then you would understandably feel differently.
To me the obvious buy signal would be the oil bubble popping. Of all the truck-dependant companies, Ford is most likely to be strong enough to take advantage of such an event.

You calculated odds, and you like what you see. That’s fine. I would say, why bother with the odds as they are? Why not wait for the odds to turn decidedly in favor of a higher stock price?

For one, it doesn’t have to be a long-term investment. Buying Ford is a speculative play, and not one to do strictly on the fundamentals.

Whether or not it makes sense all depends upon the possible scenarios that you see and the odds you that you give them. In my case, I could see the thing either wallowing around doing a whole lot of nothing, dropping by as much as half or increasing by a factor of 3-4.

If I assign odds to each of those alternatives and then add them up, I end up with a positive total, which means that I should take the bet if I can absorb the hit of the negative outcome. If you don’t see those as being the alternatives, then you would understandably feel differently.

That’s correct folks, the people who kill a company get the new stock at a bargain, while the other stockholders, who should have had a say in how to dispose of it’s properties, get nothing. This is done to protect the workers, vendors, customers, and communities from the loss of such an important company.

The powerful and the poor who are responsible get to divide the spoils of the stockholders who were just saps lenders. Sounds more like the USSR than the USA, but that’s how it is.

I would at least entertain the possibility that there is no oil bubble, and that Ford is in for hard times for years to come, even if it beats GM and CryCo. As I said, in spite of everything, things could still go horribly wrong @ Ford. Why risk it?

It’s your money. Mine is waiting in the wings…

Ha! That’s one of my favorite lines. That’s the kind of battlefield wound that seperates the men from the vomiting boys.

But it will take some time for Ford’s Detroit engineers to turn the stylish Mazda 2 into a snoozer-bland design that doesn’t scare their parochial Midwest focus groups.

Then of course they’ll need to de-content it so it will feel cheap, break frequently and require a dozen recalls, like they did when they brought the European Focus stateside and penny-pinched it into mediocrity. These things take time.

You don’t need to time it with a stock purchase. If you were buying, er, oil futures or call options on the stock, timing would be everything (which is why it is tough to short oil on the market, even if you believe that it is due for a hit.)

However, you could buy Ford stock, sit on it for a couple of years, and then let it lift itself up for whenever it actually rebounds. The exact timing won’t really matter, it will just impact your return.

Unless you believe that the stock is going to zero, the downside is fairly limited in comparison to the potential upside. If you think that the company can clean itself up, then the upside in the stock is much greater than the downside.

You can see that Mulally is trying to clean up the balance sheet, which is good. The question is one of whether he can generate the revenue that will fund that cleanup. That’s hard to say, because the lineup isn’t stellar and it has some notably weak products in it.

But then again, it need not necessarily be a complete home run for it to be worthwhile. Reducing some costs and getting a few successful revenue producers could just be enough to make the difference.

I’m still wondering about the timing of the buy, though. The second quarter numbers are probably going to be ugly, so the stock may well go down before it goes up. Not sure if I should be greedy and wait for another potential dip, or just to take the plunge now and ride it out/dollar cost average my way through it.

As the housing and internet bubbles showed, it is almost impossible to time the correction. Why try to time this one? You may end up waiting years for the oil bubble to pop. Much can go wrong at Ford during that time, e.g. the Ford family can grow tired of Mulally, or Kirk could do some damage (intentionally or otherwise). Why risk it?

I suggest an alternative strategy: wait for oil’s own Black Tuesday. In the aftermath of this correction, there is likely to be chaos in the financial markets. However, having anticipated the event, you can coldly buy Ford stock on the Wednesday. Despite our high regard for proffesional traders, these guys tend to lag the market by several weeks, e.g. many were recommending ethanol stocks at their height and only switched to get the hell out after these stocks lost 50%+ of their value. It would take weeks (at least, more likely: months) for Ford stock to fully respond to oil’s own Black Tuesday. That’s the time you can use to your own advantage.

There is a risk that Ford stock could increase in value even before oil’s Black Tuesday, but that is beside the point. A stronger Ford might respond even more positively to the popping of the oil bubble.

You might even be able to set this up automatically: Buy Ford stocks if oil drops below $75/bbl, or whatever level you choose…

See, now you even have me convinced. If oil hits its Black Tuesday (an event I still don’t see happening), even I would be tempted to buy Ford…

Katie, you forgot your ‘kick Mark Fields to the curb’ remarks.

Nissan’s quality may be laughable, I agree, BUT:

1. It’s certainly better than Chrysler’s current quality.

and

2. Infiniti has some top quality on their cars. Who do you think engineers those cars? Toyota?

Try again.

Nissan quality is about laughable as Corolla driving dynamics or Expedition gas mileage.

Sorry, try again.