by: Mitch Buthod
This quarter Ford was able to post huge profits even with the current economic slump. They were able to accomplish this by cutting costs by more than $4 billion. Layoffs and increased production efficiency were the key factors in Ford's ability to cut cost this year. They also were the only major U.S. car manufacturer to not receive a bailout from the Federal government.
To learn more about this read the following Economist article: http://news.bbc.co.uk/2/hi/business/8337876.stm
23 comments:
Good to see that at least in America, American cars can maybe compete with the Japanese.
Its good that they made a profit but I think that layoffs are not necessarily the best thing for them to be doing if you look at the implications to the country's economy.
Did the cash for clunkers program have anything to do with this profit?
It would be interesting to see where the majority of the number of layoffs took place, from factories in the U.S. or across borders, such as Mexico?
I agree with rand and if the layoffs took place here and jobs in Mexico were retained than Ford should face some criticism for this. Other than that, it looks like they are doing a good job by being financially responsible.
I'm glad they were able to profit and everything but it came a huge cost in cutting jobs. How is that supposed to help anything? Okay a few people benefitted? And we're happy about that? Until Americans are getting jobs and working i see no victory.
Is this not good news? Can we look to Ford as examples in an industry desperately in need of guidance. Without tax payer money GM would be in bankruptcy while ford said no thank you to Obama or his Zsar and posted profits. The auto industry has made bad choice after bad choice for the past 20 years and now is the culmination. For Ford to be profitable in these times is amazing and should be learned from. If they can do more with less, why not?
Obviously the U.S. auto industry can't compete internationally and that is why the auto makers are failing. From an business, free-market stand-point it would be beneficial to leave the makers alone. If they fail, they fail and those people will have to try to find work in other industries. However, it is obvious that this would have serious consequences for auto workers and to the U.S. economy. That is why I think the U.S. government should be bailing out the industry only under the condition that they are retooling to produce green cars (electric cars maybe? they had them once... I'd recommend the seeing the documentary Who Killed The Electric Car) Retooling for energy saving cars could be one of the only ways to put us ahead on the global market.
I think all American automakers need to step their game up. Even though Ford has seen gains even in tough economic times, have you ever been in one? The quality of materials inside is awful, if you are going to spend all your time inside your car why not make interior that are quality. They need to take some lessons from other quality automakers. Just my 2cents I know everyone won't agree with.
Is it good? No. Not for the individual, but that isn't important in the American capitalist system. The well proven purpose of our system is to create large quantities of wealth and concentrate that wealth in the hands of few.
This is good. It seems obvious to me that it is highly desirable to have American companies find ways to stay afloat during this recession. Pointing out that jobs were lost seems pointless to me seeing as if some jobs are not sacrificed all of the jobs are at risk of being lost.
Good for Ford, not so great for everyone else. This is just one of the many examples of why the unemployment rate is at an ultimate high. This makes it clear to see that large corporate companies are only about the profit and not so loyal to the employer.
David McKinley
Traditionally Ford vehicles often have an image of being sub-standard vehicles, with low reliability and construction quality. This was because during the 80's through mid 90's the market allowed for this. With increased competition from Japanese manufactures producing superior vehicles Ford got the message and made dramatic changes in time, producing very high quality vehicles that are very comparable to Japanese brands. This seems to lie in contrast to GM that did not act soon enough, but will have another chance.
Good for ford.
I was skeptical when they refused the bailout money, but damn they must have had some good economists telling them what to do. If only we could get these guys into governmental positions now.
As for the layoffs, I too would like to know where they came from. whether they were actually involved in production or whether they were management level. Also i know GM closed dozens of dealerships nationwide, does anyone know if Ford did the same?
I think Ford benefited from the fact that their lineup of vehicles isn't all trucks and SUVs. Sure, they still sell their fair share of those (in fact, the F150 outsells all the other trucks), but they actually have hybrid and smaller cars, which the other American car companies do not. Personally, I still do not think that the quality of ford cars is up to that of the imports, but it's at least good to see this news.
I guess the profit is a double edged sword. I wonder how much was saved by layoffs alone, because laying off people to turn a profit is not a victory in my book. I think it is great that Ford handled business without a hand-out from the government. I hope their success continues, so they can again supply more American jobs!
It's interesting to hear that an American company like Ford could be doing so well in this economic slump. That said I am not surprised to hear that the way they managed to turn profit by laying off employees and out-sourcing their labor. This however only makes the problem worse in my opinion. Instead helping to build back the United State's economy, Ford has managed to make it worse by sending many of our important jobs to other economies and leaving the U.S. to suffer.
I find it interesting that many individuals are still buying new cars given the state of our economy. Many car dealerships have reduced prices drastically and allowed for people to buy what was once not economically feasible for them. It seems that the opposite would happen, but with programs like cash-for-clunkers and others, maybe now is the best time to buy a vehicle.
That is very interesting. I'm glad that at least one company wasn't bailed out. All bail outs do is create bad incentives for business makers to continue with bad production policy, and not fix their business at all. I'm glad that we have one american car company that is still in the running!
I have to agree with rex. If everyone had the "wealth", then everyone would be worth nothing. Wealth is for the taking, who can you beat to get there? For ford that ment Chevy, Chrysler, etc.
I'm sure the cash for clunkers program helped a bit. I know i partook, and picked up an Escape. Its a sweet ride, I get 32 mpg!
ROBERT SEADER
It was impressive that Ford was able to escape the economic slump without having to rely on federal intervention. I Understand the whole "Too Big To Fail" argument, but I think that if you are in charge of such a corportation, maybe something should be said concerning a responsibility to act in a manner in which you will not fail.
This is a good topic and American car companies do a great deal in helping our economy.
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