Ford to Post Big Loss for Q4
Loses, as predicted by analysts, will be in the range of $1.22 per share. That sums up to a total decrease in stock market value of about $2.8 billion. Ford is to update its 2009 forecast, as the return to profitability is estimated for 2011.
Standard & Poor's said in late 2008 that Ford had a few more quarters of comfort than its rivals, but will be in danger of falling below cash levels needed to sustain the company in 2009, according to Autonews. Investors and creditors however are looking forward to Ford's cash burn rate. Figures for the fourth quarter are slightly less than the $7.7 billion spent in the third quarter, Ford announces.
"We don't want to borrow any more money. We have sufficient liquidity to fund our transformation plan, which means our business is in a relatively good shape," Alan Mulally, Ford's CEO said. However, the company places its trust in the $5 billion of promised loans from the Department of Energy to be used for fuel economy improvements. Furthermore, Ford began restructuring and asset selling programs to raise the much needed money.
As part of them, salaries of North American employees were cut by ten percent and the U.S. Ford Motor Credit personnel will be cut by 20 percent. So far, Ford sold 20 percent of its Mazda Motor Corp and put Volvo, the last of its former European brands, up for sale.