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The headline is "Why Bankruptcy Is a Forgone Conclusion for Ford Motor Company" - even if we step back from that proposition a good bit, to a question like "Is Ford in danger of bankruptcy?", it's quite a proposition. https://www.ccn.com/why-bankruptcy-f...motor-company/
That author may just be pessimistic, but apparently Ford's credit rating was indeed downgraded to junk by Moody's in H2 of 2019:
"Moody’s Cuts Ford’s Bond Rating to Junk Status" https://www.wsj.com/articles/moodys-...us-11568067924
...and the S&P downgraded Ford's debt rating to BBB- in H2 of 2019, that's their lowest rating above the "speculative" (i.e. junk) tier:
"Why Ford Had Its S&P Credit Rating Cut Coming" https://marketrealist.com/2019/10/wh...ng-cut-coming/
So it's not just one wild-eyed journalist who thinks there's real trouble at Ford.
And that is the company that did NOT ask to be bailed years ago? As it had good equity?
Does it sound like Ford is being set up for disaster soon? Starting with spreading panic news?
And that is the company that did NOT ask to be bailed years ago? As it had good equity?
Does it sound like Ford is being set up for disaster soon? Starting with spreading panic news?
It is surprising because it was only about a decade ago that they seemed in pretty good shape - the crash was 2008-2009, and Ford weathered it on their own. But if you're trying to say that Moody's and the S&P are both trying to manipulate the Ford corporation's business by assigning it fake debt ratings - no, I don't think they're going to do anything like that. Their relevance is dependent on market trust and further I suspect it would be illegal for such a firm to game the debt rating (SEC regs). I think Ford is fundamentally not in great shape today. There are some details in the linked articles.
If you are trying to tell me that markets are operated based on some random miraculous market force, I'll bid farewell to any idea of such nature. Markets are fully controlled by those who control them. So are media. If Ford had equity and did fine, then there is some plan to cut it at the ankles and, spreading certain rumors is one of the ways to do it.
Immediately, the Rockefeller Foundation got in on the ground floor by making a four-year grant to Harvard College, funding the Harvard Economic Research Project for the study of the structure of the American Economy. One year later, in 1949, The United States Air Force joined in. In 1952 the grant period terminated, and a high-level meeting of the Elite was held to determine the next phase of social operations research. The Harvard project had been very fruitful, as is borne out by the publication of some of its results in 1953 suggesting the feasibility of economic (social) engineering. (Studies in the Structure of the American Economy - copyright 1953 by Wassily Leontief, International Science Press Inc., White Plains, New York). Engineered in the last half of the decade of the 1940's, the new Quiet War machine stood, so to speak, in sparkling gold-plated hardware on the showroom floor by 1954.
P.S. Among the chief factors cited are an expensive and lengthy restructuring process that's underway, and declining sales in China. I verified the China sales figures and they are striking - China bought 951,000 Fords in 2016, and just 233,000 in 2019. That's a huge dropoff! I think many people don't understand how important China is as a market for US goods, but they are very important - 2nd largest economy in the world, not too far behind the US. http://carsalesbase.com/china-car-sales-data/ford/
Of course we've had the tariff wars that (a) may be affecting purchases of Fords directly by increasing their costs there, (b) it may also have aroused nationalistic sentiments that make Chinese less willing to buy American cars "on principle", and (c) it's been widely reported that the tariffs have hurt the Chinese economy, which makes them simply less able to afford to buy new vehicles of any brand.
P.S. Among the chief factors cited are an expensive and lengthy restructuring process that's underway, and declining sales in China. I verified the China sales figures and they are striking - China bought 951,000 Fords in 2016, and just 233,000 in 2019. That's a huge dropoff! I think many people don't understand how important China is as a market for US goods, but they are very important - 2nd largest economy in the world, not too far behind the US. Ford China auto sales figures
Of course we've had the tariff wars that (a) may be affecting purchases of Fords directly by increasing their costs there, (b) it may also have aroused nationalistic sentiments that make Chinese less willing to buy American cars "on principle", and (c) it's been widely reported that the tariffs have hurt the Chinese economy, which makes them simply less able to afford to buy new vehicles of any brand.
The drop off in China sales probably has more to do with the Chinese government wanting to go all EV. I suspect that is a big reason Ford has recently jumped on the EV bandwagon.
We'll see how the EV platform (Mustang CUV) and how their pullout of sedans will play out over the next 24 months.
IMO as long as they keep selling trucks they will be fine but reviews of their new explorer aren't great.
It sounds like they're already in serious trouble, and they've spent *a ton* of money on new EV programs - if those really struggle in the marketplace at first, Ford may have trouble lasting long enough to make the corrections needed to gain sales. I am sure the burn rate at FoMoCo isn't small.
The drop off in China sales probably has more to do with the Chinese government wanting to go all EV. I suspect that is a big reason Ford has recently jumped on the EV bandwagon.
Chinese economic growth has fallen significantly from the tariffs - so there are probably some layoffs there and others worried about their jobs. "China's GDP growth grinds to near 30-year low as tariffs hit production" https://www.reuters.com/article/us-c...-idUSKBN1WX05A
And I know there is now anti-American sentiment mirroring all the anti-Chinese sentiment here - I've seen the people interviewed in China.
Another clue is that Audi's sales (also ICE vehicles) in China have actually *increased* moderately over the same 2016-2019 period that Ford's sales fell by some 70%. Audi prices have been unaffected by tariffs, and there wouldn't be any anti-Germany sentiment either. Audi China auto sales figures
There's no need for people to make up alternative explanations, the data is all out there!
Any company can go bankrupt. Apple, for example, was as the brink. We'll never know if they would have declared bankruptcy because Bill Gates bailed it out.
Ford isn't that close to bankruptcy, but when I look at things like the new Explorer they clearly need to get their act together. That's an important vehicle for Ford. It's not the EcoSport which nobody cares about here because an only exists because Ford doesn't care about the economy car segment in North America. That's a car that's intended to be sold in India that they just brought here. If Ford's more expensive products going forward look the Explorer though, that's going to be a problem.
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