Ford's $12.7B loss in 2006

[jayjacobson]

Ford posts record loss of $12.7B in 2006 By TOM KRISHER, AP Business Writer
21 minutes ago

DEARBORN, Mich. - Ford Motor Co. lost $5.8 billion in the fourth quarter amid slumping sales and huge restructuring costs, pushing the fabled auto maker's deficit for the year to $12.7 billion, the largest in its 103-year history.

The annual loss of $6.79 per share reported Thursday surpassed its previous record for a year of $7.39 billion set in 1992. It earned $1.44 billion, or 77 cents a share, in 2005.

The Dearborn-based company expects more losses for this year. It expects to burn up $10 billion in cash on automotive operations through 2009 and spend another $7 billion to invest in new products.

The fourth-quarter loss was the worst final-quarter loss in Ford's history and its second-worst quarterly performance. Ford lost $6.7 billion in the first quarter of 1992, due mainly to accounting rule changes on health care liabilities.

"We began aggressive actions in 2006 to restructure our automotive business so we can operate profitably at lower volumes with a product mix that better reflects consumer demand for smaller, more fuel-efficient vehicles," Alan Mulally, president and chief executive officer, said in a statement. "We fully recognize our business reality and are dealing with it. We have a plan and are on track to deliver."

Excluding special items, Ford lost $1.50 per share in all of 2006, worse than Wall Street predicted. Fourteen analysts polled by Thomson Financial expected a loss of $1.35 per share for the year, excluding special items.

Its shares fell 10 cents to $8.10 in pre-market trading.

Ford said that special items associated with restructuring costs totaled $9.9 billion for the year as the company continues efforts to shrink itself to match reduced demand for its cars and trucks.

Sales for the fourth-quarter fell to $40.3 billion from $46.3 billion a year ago, while annual sales dropped to $160.1 billion from $176.9 billion in 2005.

For the first 20 years that I drove, I had never owned another vehicle make besides a Ford. From 1990-2001, I had bought a half dozen or so different models.

Then, in 2005, something happened: I bought a GMC 2500HD 4x4 Diesel Pickup--instead of the F250. After very carefully researching the issue, I found that the Allison tranny that GMC uses in their trucks was superior to the comparable Ford's Tranny. The Ford tranny had been problematic in earlier models of Ford's big pickup truck. Ford claimed that the tranny was redesigned and now bullet-proof. Maybe I was unwilling to risk it on a $60k truck! So, I bought the GMC and have not regretted it for one second.

Last year was another first for me: I bought a Toyota! I had NEVER owned any foreign vehicle--period. The old hag's 96 T-Bird blew ANOTHER head gasket. Just 3 years prior (30k miles), I had spent almost $3k, at the FORD DEALER, replacing both heads on the 3.8 V6. The head gaskets had been problematic on the 3.8 engines, causing the vehicle to run hot.

My regular mechanic confirmed what I believed: the most likely cause of gasket failure after such a short period of time was improper torquing of the head bolts by dealership mechanics (they used an air-gun instead of a torque wrench).

Of course, the dealer where I had the work done was of no help whatsoever. I was well outside their warranty period on the head job. They did offer to make me a great deal on a new vehicle, however. I don't think so!

I was pissed! In a slow burn! So I did something really strange. I went over to the Toyota dealer and bought a $45k Highlander highbred. Consistent with all the rumors that I had heard about Toyota's, the vehicle was flawless. Fit and finish was perfect. Not a squeak, not a rattle, no body flex--perfect! The vehicle has been getting 30+ MPG also (amazing for a mid-size SUV WITH FOUR WHEEL DRIVE).

So, does the news from Ford surprise me? Not in the slightest! I can't think of another company that so richly deserves the misfortune it now faces.

BTW, I noticed that Ford's brand new 500 (supposedly brand new from the ground up) IS NOT available with HID's or LED's. Both the Camry and Accord have then standard, or available as options. Hmmmmmmmmmmmmmmmmmm.

[Florian]

Ford has produced nothing but garbage for the last 20 years and now its biting them in the ass. The only products Id buy from Ford would be an F150 Lightning or a Mustang, and only then after long investigation of the product. Im a GM guy, have been for years now, and have been really happy with the products.
Hard to watch such an institution crap its pants, but cant say nobody saw it coming.

F

[tmgs]

Then, in 2005, something happened: I bought a GMC 2500HD 4x4 Diesel Pickup--instead of the F250. After very carefully researching the issue, I found that the Allison tranny that GMC uses in their trucks was superior to the comparable Ford's Tranny. The Ford tranny had been problematic in earlier models of Ford's big pickup truck. Ford claimed that the tranny was redesigned and now bullet-proof. Maybe I was unwilling to risk it on a $60k truck! So, I bought the GMC and have not regretted it for one second.

The old hag's 96 T-Bird blew ANOTHER head gasket. Just 3 years prior (30k miles), I had spent almost $3k, at the FORD DEALER, replacing both heads on the 3.8 V6. The head gaskets had been problematic on the 3.8 engines, causing the vehicle to run hot.

My regular mechanic confirmed what I believed: the most likely cause of gasket failure after such a short period of time was improper torquing of the head bolts by dealership mechanics (they used an air-gun instead of a torque wrench).

Of course, the dealer where I had the work done was of no help whatsoever. I was well outside their warranty period on the head job. They did offer to make me a great deal on a new vehicle, however. I don't think so!



we used to have a saying if it weren't for GM we would be out of a job, I was a auto tech for many years we own two gm products now hopefully they will be my last ones they have been very unreliable a 99 Buick and a 95 olds they both suck.

I was a ford trained engine and AC tech, trust me the 3.8 would blow a gasket if it overheated slightly, it had nothing to do with the gasket itself, it was aluminum heads they warped and warped fairly easy.

There is no way your mechanic could definitely say the head bolts were not correctly torqued or more so no way he could say they used a impact on them!
Especially after 30k miles No way whatsoever, that is purely speculation.

(also keep in mind there are impacts that are torque wrenches like they use at the factory)

The other troubled engine was the 3.0 it would snap head bolts (those were easy money jobs)

As far as Toyota there IMHO is no better built automobile on the market, the machining is remarkable, (i worked for a Toyota dealership for a while), I swear you could put one of those engines together with no gaskets they were so well machined!

Personally it just does not matter what you buy these days

Tom

[jayjacobson]

I was a ford trained engine and AC tech, trust me the 3.8 would blow a gasket if it overheated slightly, it had nothing to do with the gasket itself, it was aluminum heads they warped and warped fairly easy.

There is no way your mechanic could definitely say the head bolts were not correctly torqued or more so no way he could say they used a impact on them!
Especially after 30k miles No way whatsoever, that is purely speculation (also keep in mind there are impacts that are torque wrenches like they use at the factory)

The engine was running very cool after the head job and did not even get hot--much less overheat. And if the head bolts were torqued correctly, if just deepens the mystery. Bottom line: there was no reason for another head gasket to blow and I am unable to get a definitive reason why it happened! Shame on Ford for building such a piece of shit.

[Bandit]

i am on my second camry and first lexus.

when i bought the lexus i could not get the integrated garage door opener programmed. i phoned the dealer and within 30 minutes a technician was IN MY DRIVEWAY, programming the unit to make sure it worked perfectly.

the camry has 100 thousand miles on it and has never given me a bit of problem. it still runs perfectly.

i will never buy another american car. i learned the hard way ... with a chevy station wagon and a dodge ram truck.

[cfell]

And all along, the finger was pointing to the employees and unions.. meanwhile, those in control were raiding it...

[kevincook]

I've had better luck with my Ford trucks than with my Chevy trucks. I've had vans, SUV's and pick-ups. The Chevys run drive better but the Fords have lasted much longer.

I have an expedition now and have not had any problems other than a few minor electrical glitches but compared to my wife's Toyota 4runner the expedition is a piece of junk. The 4runner is the first Toyota we have owned and everything about the vehicle is absolutely perfect. You can tell the engineers and designers called the shots and the accountants just count the money that is rolling in.

We did have one problem with the 4runner the first winter we owned it. Occasionally when the temps were below 0°F and you were driving 80mph or greater the vehicle would lose power and quit running. As soon as you pulled to the side of the road you could restart the vehicle with no problem. The second time this happened to my wife she brought it over to the dealership right away. The dealer had gotten a message from Toyota engineering the day before that if they had any 4runners come in with this problem to not touch the car and give them a call the engineers wanted to come look at the car. My wife's car was the second call that day....by 8am the Toyota engineers were already on their way to Albany. I was confident Toyota would figure out what was going on and come up with a fix so I forgot about the problem until the following October. Toyota called US! They asked if we still had the 4runner and said they had a fix for the problem we had the previous winter! I didn't call to complain or ask about an update. Toyota was keeping track and when they had a solution they called ME! If it was Ford, they would still be denying there is a problem :( .

I'll probably buy another Ford but if Toyota comes out with an SUV based on the new Tundra platform I know where I'll be shopping. Especially if it has a small diesel :D :D :D

Kevin

[Bandit]

I'll probably buy another Ford but if Toyota comes out with an SUV based on the new Tundra platform I know where I'll be shopping. Especially if it has a small diesel :D :D :D

Kevin

i'm pretty sure the sequoia is based on a tundra platform. don't think it's available with a diesel, tho.

http://www.toyota.com/sequoia/index.html?s_van=GM_TN_SEQUOIA_INDEX

[sanjaun2]

And all along, the finger was pointing to the employees and unions.. meanwhile, those in control were raiding it...
I know Ford has been in trouble for decades even though the books didn't show it. I find it very interesting that the former boss of Boeing is now working for Ford. They figured that less than 8 percent of the cost of building airplanes went to employee salaries. He and the other "officers" would fight tooth and nail to reduce the salaries and benefits of the employees and then give themselves 20 million dollar bonuses, houses,cars,vacations, everything else including hookers! If that wasn't bad enough they shipped most of the jobs overseas and moved the headquarters away. Boeing was lucky to survive their ways. I believe they only survived because they only have one major competitor and they have there own problems. The employees at Ford have endured some tuff times but nothing compared to whats in store.Their jobs and pensions are about to be obsorbed into the corporate benefit package.

[jayjacobson]

i am on my second camry and first lexus.

when i bought the lexus i could not get the integrated garage door opener programmed. i phoned the dealer and within 30 minutes a technician was IN MY DRIVEWAY, programming the unit to make sure it worked perfectly.

the camry has 100 thousand miles on it and has never given me a bit of problem. it still runs perfectly.

i will never buy another american car. i learned the hard way ... with a chevy station wagon and a dodge ram truck.

Yup, at 100k, a toyota is just breaking in. At 200k, you do a head job and at 400k, you finally have to do a long block.

[jayjacobson]

I'll probably buy another Ford but if Toyota comes out with an SUV based on the new Tundra platform I know where I'll be shopping. Especially if it has a small diesel.

I wouldn't waste my time with the Ford. The only reason I did not buy a Tundra is because there was no diesel option. I expect toyota to correct this problem shortly.

[jayjacobson]

They figured that less than 8 percent of the cost of building airplanes went to employee salaries.

WOW! I never would have guessed. About the hookers....at least they could have shared!

[deputy5211]

I'll probably buy another Ford but if Toyota comes out with an SUV based on the new Tundra platform I know where I'll be shopping. Especially if it has a small diesel.

I wouldn't waste my time with the Ford. The only reason I did not buy a Tundra is because there was no diesel option. I expect toyota to correct this problem shortly.

I heard a rumor that the Tundra will have diesel available in the mid 2007 model year.

[ckatopodis]

Worst car I ever owned was a Ford Taurus. Multiple waterpump replacements, transmission replacement, bad paint job. All with less than 60,000 miles on the car. After the transmission was replaced, I asked our mechanic what make he recommended. Toyota or Honda was the answer. We bought a used Camry and now have over 120,000 miles with no troubles at all. Three years ago I bought a 4runner, best vehicle I have ever owned. Recently gave the Camry to my son and bought my wife a Corolla. We plan on owning these a long time.

[mwagner]

I'm 62 and have owned only 4 new vehicles in my lifetime. Not because of finances, cuz I have the same feeling at any vehicle dealer as I do on April 15th, "La Shaft"! 1990 Ford 4x4 F150 302 V8 with oil and filter changes every 2000 miles blew up on I-44 (60,000 miles) in the Ozarks after 600 miles on the "new change" Three thousand bucks and 10 visits to the Ford Dealer I had my rebuilt 302. First rebuilt lasted 4 days, second still runing. Wow. The folks jammed the filler dip stick tube while installing the first rebuilt and the tran leaked half quart a day on the garage floor. (Rectified after 6 attempts)
Blah blah, bought the Ford because the Datsun pickup (1980) would not even make a good anchor, 2 lite. Piece a *^%p, alum head, metal block, head gaskets blowing all the time. Gave my 64 GTO and 70 buick away because they both had spare tires floating in there trunks, rust belt victims.
So now I have purchased a Kraut vehicle, had a 2007 K1200GT delivered the day after Thanksgiving :bmw: I have this informative site to blame for that, wish me luck, I am afraid of the new machine. Am still waiting for all of my ATGATT stuff to arrive. Galena Missouri fond regards to you all out there :)

[tmgs]

The engine was running very cool after the head job and did not even get hot--much less overheat. And if the head bolts were torqued correctly, if just deepens the mystery. Bottom line: there was no reason for another head gasket to blow and I am unable to get a definitive reason why it happened! Shame on Ford for building such a piece of shit.


yup that 3.8 is a POS, it sure as heck didn't take much to blow a gasket

I'm not a GM fan either but your toyota will put last me!

[grifscoots]

and then give themselves 20 million dollar bonuses, houses,cars,vacations, everything else including hookers!

Where can I get an application?

[sanjaun2]

Where can I get an application?
People at work are always telling me to go into management. My standard reply is that I would get fired within a week. I believe in right and wrong and saying what's on my mind. But If I could get the job during the bonus week...

[jayjacobson]

People at work are always telling me to go into management. My standard reply is that I would get fired within a week. I believe in right and wrong and saying what's on my mind. But If I could get the job during the bonus week...
I'm not even in management and they're STILL trying to fire me!

[dshealey]

i'm pretty sure the sequoia is based on a tundra platform. don't think it's available with a diesel, tho.

http://www.toyota.com/sequoia/index.html?s_van=GM_TN_SEQUOIA_INDEX

My daughter has a Sequoia, one great vehicle! Yes, it is on the Tundra platform.

[dshealey]

I bought my first Toyota in 1969, have owned only imports since then. Several Toyotas, 4 of them Cressidas, which was the top of the line unitil they came out with the Lexus line. Still have the '82 pickup with over 200,000 miles on it. Will give it away when we move, body looks like crap, but it still runs great!

I was a staunch Toyota fan until buying a '95 BMW 525i about three years ago. That car is in far better condition at 170,000 miles than any of my Toyotas were at less mileage. I also now have an '01 740iL. We looked at similar age Lexus's before deciding on the BMW. The Lexus is very likely more reliable over time, but the 740 is more comfortable to me, great seats, and drives considerably more "sporty". BMW cars handle better than just about anything else in my opinion, although they typically need the front upper thrust arms replaced about every 75,000 miles to maintain that. Otherwise they develop a shimmy around 50-60 MPH. I did put Bilstein shocks on both my cars though, like putting Ohlins on the LT. :)

Don't think I am ever likely to own an American vehicle again. Shame we let that industry get away from us. It is NOT the workers, it is the Bean Counters not allowing the very capable engineers to do the job right. Cheap out the design, and stuff the pockets of upper management and of course the Union leaders.

[dmatson]

I need a heavy duty truck soon so it looks like a crew cab F350 4X4 with the new 6.4 diesel and 5spd auto is going to be my next purchase and then a 5th wheel toyhauler. The new 6.4 looks to be a great motor and the reviews are all very good. I wish the new Tundra would do the job but it won't. I have a Tundra now and it's a good truck but it not that great of a work horse as a truck should be. Quality is fine but its not that well thought out. I hope that with Fords finanical trouble that they are willing to make a great deal!

[midwilshire]

At this rate, Ford will be broke in a year and bankrupt in 3.5 years.

[jayjacobson]

I need a heavy duty truck soon so it looks like a crew cab F350 4X4 with the new 6.4 diesel and 5spd auto is going to be my next purchase and then a 5th wheel toyhauler. The new 6.4 looks to be a great motor and the reviews are all very good. I wish the new Tundra would do the job but it won't. I have a Tundra now and it's a good truck but it not that great of a work horse as a truck should be. Quality is fine but its not that well thought out. I hope that with Fords finanical trouble that they are willing to make a great deal!
GMC has just redesigned the Sierra line for 2007. Diesels due in six months. I would check the superb HD Allison tranny on these puppies before buying the Ford.

[jayjacobson]

At this rate, Ford will be broke in a year and bankrupt in 3.5 years.
If not, Toyota will overtake them as the number two vehicle manufacturer, anyway.