Ford stumbles as GM and Chrysler gain

Ford shares slump on disappointing results.

By Jonathan Berr Jan 27, 2012 11:52AM
Ford Motor (F) is the only car company of the Big Three not to end 2011 on a high note. The only one of the three that didn't need a government bailout has stumbled as its rivals have gained.

Net income at the Dearborn, Michigan-based company reported net income of $13.6 billion, or $3.40 per share, versus $190 million, or 5 cents per share the year before.  Excluding one-time items, profit was $1.1 billion, or 20 cents per share, 5 cents below Wall Street consensus forecasts. Revenue rose to $34.6 billion.

Ford's strength in the U.S. was offset by weakness in other parts of the world. Ford's loss in Europe almost quadrupled to $190 million, while its operations in Asia Pacific and Africa swung to an $83 million loss as the floods in Thailand hurt its bottom line. The company's South American business reported a profit from continuing operations of $108 million, but that was a decline from $281 million a year earlier as competition intensified.

Meanwhile, General Motors (GM) and Chrysler Group, which needed government help to avoid collapse, are on a roll. GM recently regained the crown as the world's largest automaker after reporting 2011 global sales of 9.026 million, a 7.6% increase from 2010.  Chrysler's results were even better. It sold 1.37 million units in 2011, a gain of 26% from 2010 -- the largest gain of any full-line manufacturer. Chrysler reported its biggest monthly sales gain in December in four years.

As competition rises, Ford may have to offer additional incentives to bolster sales. CEO Alan Mullaly foresaw the financial crisis before most people. Let's hope his crystal ball has not become too dusty.

Jonathan Berr is a freelance business writer. He does not own shares of the listed companies.
Tags: Fgm
116Comments
Jan 27, 2012 1:52PM
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Only Wall Street can report that a company did not end the year on a high note when in fact it was their best year since 1998. The employees all received $6200 profit sharing bonuses. I would say the employees ended the year on a high note! And I must add Ford is paying back all the creditors they borrowed money from. I guess if a company is not sticking it to the employees and the creditors Wall Street doesn't like the way they do business?
Jan 27, 2012 1:11PM
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Odd, You compared units sold at GM and Chrysler Group to net income at Ford,  without even mentioning Ford's sales numbers. For all you know, until they report earnings, GM and Chrysler Group  lost money in 2011.

 

Then you say that Chrysler's results of 1.37 million units sold was better than GM's sales of 9.026 million units. I can only assume,  because you seem to consider a high percentage sales gain as the defining factor of how well a company is doing, that you are trying to say: Because Ford's sales didn't fall as far as GM's and Chrysler's did, Ford can't possibly being doing better then they are.

Jan 27, 2012 3:18PM
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sounds like this was written by someone from Obama's Admin. putting down Ford and propping up GM/Crysler- even though Ford was the only one posting a profit
Jan 27, 2012 5:40PM
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Jonathan Berr does not seem qualified to write this artical. All 3 have picked up market share from the year before.  GM still owes BILLIONS.  And Ford is doing so poorly that they are expanding.  This artical is misleading and should be deleted!

 

Jan 27, 2012 4:11PM
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It also fails to mention that the government asked Ford pull their add that basically said ( We don't want your money we want your business).  Its funny that the government will let the two companies that they own (GM & Chrysler) have adds that slander Ford but when Ford tries to put one they ask them to take it off the air.
Jan 27, 2012 3:58PM
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Deceiving statistics at best.  The article doesn't compare apples to apples.  Looks like Jonathan Berr could benefit from a few more journalism classes, or at the very least, an Econ 101 course.  I would bet that Statistics was not his strong suit.  But he probably aced his deceptive journalism course.
Jan 27, 2012 4:42PM
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I work at a Ford dealership. I can't even begin to tell you how many people bought because they didn't ask the gov't for money. I had to take the day off from exhaustion because sales are booming here. I'm not sure what the plan for the future at Ford is but you can bet I'll continue to buy stock.  
Jan 27, 2012 5:28PM
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When do they plan on paying the taxpayer back?  GM still owes 60 billion bucks. 
Jan 27, 2012 4:57PM
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I bought GM because of there great new designs, quality & safety.  I also felt being a TAXPAYER, it is a better investment to help in their success because if they fail, I, as a TAXPAYER have more to lose, the taxes that autoworkers pay, Chrysler & GM pay and the fact that I really don't wan to support millions with welfare, food stamps and through he Government Pension fund.  I also appreciate the sacrifices made by the workers, the fact money has been repaid, and more will be repaid.  I also like to support all the support workers, including suppliers, advertisers and charities.  I also appreciate the money all these works are putting back into theeconomy.  I know the TAXPAYER could not afford their collapse.  It would have been much more costly  to  ALL of us!!!!!!!!!!
Jan 27, 2012 4:17PM
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The reason Ford doesn't use the fact that they didn't take bailout money in their advertisements is because then the information would come out that they mortgaged all their hard assets through private source the year before GM and Chrysler borrowed federal money, or face bankruptcy.  Ford is now at a financial disadvantage.
Jan 27, 2012 4:47PM
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Some of you are spot in your criticism of the above article. Biased to the extreme. Ford took no Fed money. Sold even its Blue Oval logo to generate cash, dumped all other product lines and leveraged itself to the walls to get itself righted for the impending economic storm, but now this article literally says their either stupid or in fraught for doom. OK. As per the commentor below, I guess giving bonuses to your employees, sharing the wealth is not good business.

How come he didn't mention what the Volt cost was......$2 Billion. That translates to $250,000 per car for the 8,000 cars built, of which 1,000 sit unsold. Me, I'll stake my claim with Mullaly!!!

Jan 27, 2012 3:57PM
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I own 3 Ford vehicles.  I would never buy Government Motors or Chrysler.  I wonder why Ford doesn't use the fact they did not take out bailout money in their advertisements?  Also, Imagine how well Ford' bottom line would be right now if they got $50 billion in free money like Obama Motors?
Jan 27, 2012 5:04PM
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cmc111376 - Not sure why you are yelling, but to point a fact the creditors of GM got screwed just like creditors of personal bankruptcy folks do.  In addition, the stock holders whoa re also creditors, got screwed out of billions when GM's old stock went to ZERO!  They should have been allowed to fail.  Also, look up the actual numbers, your 59 billion is off by 21 billion.  the actual amount to include "stock ownership" was 80 billion!  The government has no business owning corporate stocks such as this.  it's nothing more than a loan.  Did you know that the GM unions are voting in KC this week on whether to strike or not because of a seniority issue?  How ridiculous is that.  These people should have been shut down several years ago, but instead they were bailed out along with GM and now they want even more.  i am sick and tired of paying for these problems.  Like most of the folks here, and around the country, i work and pay a huge amount in taxes.  It should be used for more socially conscious efforts.  Defense, immigration reform, Homeland Security....

Jan 27, 2012 3:44PM
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BOTTOM LINE - FORD TOOK NO GOV'T (means OUR) MONEY - and, as other's note already why relate 'units sold' to Ford's dollar volumes?  Also fails to specifically mention, much less give Ford kudos for paying off over $3-billion in debt??

 

Government Motors should, from now on, be rated/compared only to include the big, fat MINUS for what 'we' gave them (and what they stole from bondholders) - and Chrysler shouldn't even count as "big 3".

Jan 27, 2012 5:29PM
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job banks are for dead weight like yourself who are still paid to sit and read papers while they collect paychecks. THAT is a job bank. and THAT is what happens when you employ overpaid union thugs for low & medium skilled jobs= your company goes under. go compete in the real world!
Jan 27, 2012 5:25PM
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Don Quix the UAW hasnt laid off workers over the last 20 years?  Really?  Thats why the jobs bank was such a huge issue in the chapter 11 proceedings huh?

 

You know what the jobs bank is right?  LAID OFF WORKERS YOU IDIOT! 

Jan 27, 2012 5:31PM
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Don Quix unions are for smart people that realize without someone to stand up for their rights you get WalMart or Apple.  A CEO making $300+ million a year with workers making minimum wage.

 

You know why we are in such debt?  The workers, the people that spend money have no money to buy things.  Thats cutting off taxes to states, and as their pay goes down the taxes the government gets goes down.  Social security is only taxed on the first $108,500 so as workers make less and CEOs make more less goes into social security.  But a smart guy like you must understand this right?

Jan 27, 2012 4:51PM
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If you think the economy is bad now how do you people think the economy would be with 2 million workers out of work because GM went out of business?

 

And dont pull this oh it wouldnt have been that many people.  Not only would all the direct GM employees be out of work, but all the dealership employees would be out of work and that number is huge, then add in the advertiding companies that only do work for GM they would have to cut staff, the independant contractors that work for GM would no longer be needed, the suppliers would have to cut workers because GM sold 9 Million cars in the world last year.  Thats a lot of parts no longer being made and when you arent making those parts you dont need all those employees. 

Jan 27, 2012 5:13PM
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don quix dik

you are dumb as a box of rocks

Jan 27, 2012 6:31PM
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Jonathan,

Thanks for your interest in Ford.  We can understand why you and your readers are following the automakers – manufacturing is so important for so many people.  It is an important part of the US economy and it is great to be contributing with a strong company and additional jobs.

I'd like to take the time to clarify a few items from your post to both yourself and your readers. From our standpoint, it is premature to compare our 2011 results with GM’s and Chrysler’s – especially since the other two companies have yet to release their numbers. We had a solid 2011 across our business.  Despite all the challenges out there, we delivered our 10th consecutive quarter of pre-tax operating profit and our best annual pre-tax operating profits since 1999.


We’re excited about the future and being part of a strong US and global economy. 


Craig Daitch
Digital Communications
Ford Motor Company

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