Ford surprises with $1B profit; sees profit in '11

[Anto]

Link

"DEARBORN, Mich. – Ford, the only Detroit automaker to dodge direct government aid and bankruptcy court, surprised investors with net income of nearly $1 billion in the third quarter and forecast a "solidly profitable" 2011.

The automaker said Monday earnings were fueled by U.S. market share gains, cost cuts and the Cash for Clunkers program, which drew flocks of buyers to showrooms this summer. Ford's shares rose 58 cents, or 8.3 percent, to $7.58 in pre-market trading.

The latest results signal that Ford's turnaround is on more solid ground. The company lost more than $14.6 billion last year and hasn't posted a full-year profit since 2005. While it made a profit in the second quarter, that was mainly due to debt reductions that cut its interest payments.

"Dearborn, Mich.-based Ford reported third-quarter net income of $997 million, or 29 cents per share. Ford also forecast a "solidly profitable" 2011. Previously the automaker said it would be break-even or better.

Its key North American car and truck division posted a pretax profit of $357 million, the company's first quarter in the black since early 2005. Ford cited higher pricing, lower material costs and increased market share for the improvement."

[Jason M. Hendler]

I understand critics of Cash for Clunkers insist the government just moved profits from Q4 into Q3, but this is encouraging news. It means that Ford and other automakers can survive this downturn, assuming they sow their profits into the right developments.

[omnimoeish]

Ford is definitely on the right track. I am surprised. I thought American auto making was going to quickly become a thing of the past. Ford is doing it without the government too.

BUT, Ford's "profits" are due to pretty much the same reason as the other corporations which are seemingly evidence that the economy is turning around. As Ford states, they cut a lot of labor, a lot of commodities are costing less due to weak demand for pretty much everything. Short term corporate profits are a very thin silver lining for a very big and dark cloud on the horizon as housing and unemployment are much worse than anyone even realizes, and who knows what oil will cost in a year.

http://seekingalpha.com/article/1704...s?source=email

[Texas]

Hummm, how do you think the UAW will react to this news? Yup, strike! lol.

I hope they give their genius CEO time before they kill the recovery project with ridiculous operational control demands.

[omnimoeish]

http://www.cnbc.com/id/33603990/site...ext|&par=yahoo

"We expect, and it certainly looks like it's materializing so far, that fourth-quarter sales will higher than those pre-'Clunker' levels," Pipas said. Fuel-efficient vehicles are leading Ford's sales increase, he added.

Wow, what a breakthrough, there's an American auto maker that gets it, if they build nicer sedans, they will stop losing gobs of market share, not to mention cash.