Will Ford motor company be able to turn things around and compete in this tenuous and changing economy?

Question

At the time of this question stocks are at $4.49 a share and June sales are down 27.9%! About one year ago I saw that Ford was under $10 a share, and thought that they would be a good investment. Now I'm not sure if they will make it. They appear at least to be advancing in green technologies etc. What do you all think?

Answer 1

I have worked for Ford, and I know their culture. They won't make it. They have old school thinking and a lack of vision.

In the late 70's, we all knew that MPG was "it". So, Ford built the Escort and sold all they could. It was a mediocre car at best. Then fuel costs came into line with everything else, and all was good. They built vans, trucks, SUV's and you know the story.

Nearly nothing was spent on what mattered: building a franchise of small cars that got great MPG and were great cars. So, here they sit, wondering what happened. They had 30+ years to prepare for $4 gas and they bought Jaguar instead. Why? Who could know.

Meanwhile, every import brand built factories in the USA and hired non-union labor. The folk that work at these plants are happy, loyal, well compensated and vested. They turn out a great product that sells itself.

The Ford geniuses were too worried about what kind of suit to wear, or what brilliant presentation they could make to their management. They were always under pressure to impress one another, not do what needed to be done. They took their eye off the prize.

Answer 2

Great question, I wish I had the anwser!

If I knew for sure that Ford would turn it around, I would buy 100000 shares, and become rich!

If I knew for sure that Ford was gonna go bankrupt I would short 100000 shares, and make about $400,000 dollars.

No one knows for sure. However, if you invested in ford already, give yourself a number that you will sell at now, an amount you want to lose and no more and be ready to sell if it goes there. On the upside, it Ford comes back, give yourself a number, where you will sell half your shares for some profit, no one ever went broke taking profit, and let the rest run. Don't buy more ford until you are diversified, remember putting all your eggs in one basket can lead to scrambled egges and no money. Good luck.

Answer 3

They are so far behind the Japanese it's going to be a titanic struggle to survive.

The signs were there years ago, and while Toyota and Honda started making more fuel efficient cars and concentrating on smaller cars, Ford and the other US car companies for the most part ignored it and chose to make large SUV's and pickups.  

Ford is at least two years behind Honda and Toyota in terms of fuel efficiency and alternative fuel vehicles.

Answer 4

I think they made absolutely terrible strategic decisions several years ago.  They focused their efforts on selling SUVs and pick up trucks and neglected the market for fuel efficient vehicles even though the Focus was and is a top contender in that market.  Green Technologies?  They are way behind the curve.  The only way out I see for Ford is for Chrysler to go belly up first, which may not be all that unlikely.  Too bad.  I have a 10 year old Ford Contour and it has been a terrific car.  They probably wish they were still manufacturing it.  36 mpg on the hiway.