Ford company announced this week a lower than expected loss for the first quarter in 2009. Also the company announced that it remains on track to meet its financial targets despite the worst quarter for the car constructors since 25 years.
Ford is the only car constructing company in the U.S. that didn’t receive loans from the government to help avoid bankruptcy, but this quarter it made net losses of $ 1.4 billion. There is not only the loss of $ 1.4 billion, but also the revenue dropped with 37% to $ 24.8 billion in the this quarter. Ford is already making losses since 2005, what brings the total losses just under $ 40 billion. Unless the bad results Ford is doing better than expected, Wall Street was expecting a revenue of only $ 22 billion. It’s also doing better than its two U.S.-based rivals.
Based on what Ford said in its statement that it still does not intend to ask for federal aid, it’s also going to restructure its debt and make changes in its labor contract with the United Auto Workers union.
According to me the financial crisis keeps making victims in the car industry and all the other sectors. At this moment buying a car is not the priority for the most people so the car industry is collapsing. It’s important that the government keeps supporting G.M., Ford and Chrysler because otherwise the damage will be disastrous not only for the economy but also the unemployment rate will raise again.
Source:http://money.cnn.com/2009/04/24/news/companies/ford_results/index.htm?postversion=2009042408
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I agree with Maxime. In times of a bad market situation, people try to save their money for expenses which they can't avoid. Such as energie bills. Buying a car is only a priority when the other one is broken.
BeantwoordenVerwijderenI also agree with Hanne and Maxime. A lot of companies pass through a difficult period. It is the governments job to tackle this problem by supporting the companies. But there is one big mistake..they put no attention to the mall companies. So only the big ones survive. Is this fair?
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