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...family member to run the outfit in 19 years--plenty of critics said that any guy named Ford, especially a granola-crunching one, was a bad choice for the job. A lot of people still think so. "Any insider is the wrong person to fix a Ford or a GM," argues a hedge-fund executive who is shorting Ford stock. "Insiders have too much of a connection to the status quo and the legacy of the company to make the tough decisions that are needed." Executives humored him but cringed when he announced he wanted to make his company environmentally...
...Japanese started making good SUVs too, and the competition made the profit margins shrink. When the price of gas soared, SUV sales tanked, and the U.S. companies were caught without money spinners. Ford stopped making the four-ton Excursion, which had been criticized as a gas-hungry dreadnought. GM's solution, "employee pricing" for everyone, gave away the store. Ford had to match...
Will the new designs be enough to stop the rot? Ford Motor's share of the U.S. auto and truck market has been steadily declining, from 24.1% in 2000 to 17.4% last year, while GM's shrank from 28.3% to 26.2%. To put that into perspective, Ford last year made 3.15 million vehicles, although it has the infrastructure to make 3.9 million, by Harbour Consulting's calculations. That kind of capacity utilization--79%--is hideously inefficient. The company's stock price has fallen 39% in a year--wiping out more than $10 billion in shareholder value...
Ford Motor is in much better shape than GM, in part because it is smaller by about one-third in the U.S. While GM is awash in red ink, Ford Motor overall is still profitable, thanks to trucks like the F-150 and its finance and global business, which includes Mazda, Volvo and Land Rover. (Another brand, Jaguar, is losing money.) On the cost side, the U.S. carmakers are dragged down by the huge burden of benefits for retired workers, such as health care, which account for $930 of the cost of each of GM's vehicles, $560 of Ford...
...products for the 2007 model-year. Carmakers plan to launch more than 60 vehicles, starting next month, swelling auto malls with all manner of compacts, coupes, wagons, minivans, muscle cars and SUVs. For manufacturers, producing a car that stands out is getting tougher every year. And as Ford and GM are painfully aware, if your metal doesn't shine in the style department--and you can't beat your rivals on performance or reliability--all you can offer is a cut-rate deal, a path to financial ruin. What's a carmaker...