Wall Street: Ford (NYSE:F) Profits In Spite Of No Government Help
Net income for the Ford Company has increased by approximately 70% for the third quarter. This is the best that Ford has achieved in years. Wall Street had not predicted that the company would do so well. For the sixth consecutive quarter Ford has posted profits with their net being $1.7 billion between mid- summer and early fall. It has been predicted that GM and Chrysler will be showing gains as well. This is an impressive turnaround from just one year ago when several of US automakers were filing for bankruptcy.
Ford Rejected The Government Bailout
Ford was the only US car company to decline the government bailout and has consistently shown growth throughout the year. The company has worked hard to cut costs and this has been a benefit to Ford, helping them increase profits. Worldwide sales are decreasing; however Ford is countering this by adding products that are current in today’s market.
Ford’s Future Outlook
Automakers plan to invest $2 billion into their Michigan plants; this is due to tax breaks that the state has provided. Incentives could bring in as many as 2,300 jobs either for Michigan or for other states that may choose to offer incentives to bring the jobs into their state. United Auto Workers has stated that workers who have been laid off will receive their jobs back first. New hires will be offered work at reduced wages. Ford intends to offer convertible debt securities during the fourth quarter; the plan is to reduce the debt they currently have by more. A cash premium as an incentive will be presented to holders allowing them to change shares into stock.
Posted by Jenny DeMichele
on Oct 28 2010. Filed under Business, Featured, Personal Finance, U.S. Economy.
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