Ford Loses $8.7b in Q2
And there you have it. The hit from Hell, sucking the life out of FoMoCo. Automotive News [sub] brings the noise. "In the financial report, Ford said that it took $8.0 billion in special charges to write off the value of troubled assets — including a $5.30 billion charge for Ford North America. The North American unit posted a $1.3 billion pre-tax loss in the quarter compared with a $270 million loss during the same period a year ago." If not for foreign ops… "Ford said it posted a pre-tax profit of $582 million in Europe during the quarter, up from $262 million. It also turned profits in Asia and South America." If not for Volvo… "The Volvo unit lost $120 million compared with a loss of $91 million a year ago." As promised, Ford announced the truck-related loss along with its plans to turn the not-so-supertanker- anymore around. [TTAC coverage continues.]. Meanwhile, according to Bloomberg, "Ford said it had $26.6 billion in automotive cash at the end of the quarter, down $10.8 billion from a year earlier." Chief Financial Officer Don LeClair is "confident'' Ford has enough liquidity. Sorry. "One time" expenses or no, there's no way Ford can sustain that kind of loss indefinitely. It's a race against the clock, and the clock is in the lead.
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Ford presentation showing in detail the financial picture and future product plans: http://www.ford.com/doc/ir_20080724_2q08_earnings.pdf
These figures are mind blowing. They are greater than the many countries overall budgets. Check out Zimbabwe - the figures must give solace to old Mugabe
Most of the one-time charge I think is for re-tooling the plants to build more flexible and fuel efficent cars. The plan is to have everything here like the euro focus and fiesta by 2010 which is all of 17 months from now. Who know maybe chrysler will go down before then.