Footballfan Posted July 13, 2006 Share Posted July 13, 2006 http://www.bloomberg.com/apps/news?pid=206...&refer=home Quote Link to comment Share on other sites More sharing options...
2005GTP Posted July 13, 2006 Share Posted July 13, 2006 Typical....Ford is dead.............now if they would stop their piss poor hiring practices and get some people in there that actually have a clue and possess leadership ability.....maybe....just maybe they can turn it around. Quote Link to comment Share on other sites More sharing options...
Michael Reynolds Posted July 13, 2006 Share Posted July 13, 2006 Typical....Ford is dead.............now if they would stop their piss poor hiring practices and get some people in there that actually have a clue and possess leadership ability.....maybe....just maybe they can turn it around. Quote Link to comment Share on other sites More sharing options...
DSenstad Posted July 13, 2006 Share Posted July 13, 2006 I read this to say that the rich are feeling a little of our pain, very little perhaps but I appreciate it. Quote Link to comment Share on other sites More sharing options...
Mark B. Morrow Posted July 13, 2006 Share Posted July 13, 2006 It is a good start. If more corporate boards follow suit maybe they can start looking beyond the next quarter and build real long term value. Quote Link to comment Share on other sites More sharing options...
NickF1011 Posted July 13, 2006 Share Posted July 13, 2006 Guess Ford had to pay for their new warranty program somehow. Quote Link to comment Share on other sites More sharing options...
johnnyb82 Posted July 14, 2006 Share Posted July 14, 2006 I read this to say that the rich are feeling a little of our pain, very little perhaps but I appreciate it. Not all stockholders are rich and many have lost a lot of money already on a company they believed in enough to risk their hard-earned savings. Quote Link to comment Share on other sites More sharing options...
xr7g428 Posted July 14, 2006 Share Posted July 14, 2006 (edited) This is an important signal. Looks like some one thinks this stock should be worth about $4. Maybe less. Cutting the dividend tells the real owners of the company that the stock price is going nowhere. The chances for a turn a round in the near term are non existent. If the stock gets cheap enough it would make sense to part the sucker out. Still a lot of assets. There are still substantial cash reserves, real estate, and the names are worth something. Honda could get into the truck business with a Ford sub brand, side step the UAW and leap frog the competition. Volvo might be a way for Toyota to break down the market bartriers in Europe. Maybe Jag and Rover could be bundled up to some Chinese. I would bet in liquidation that it might be worth $30 a share... As a car company, Ford is done. They have pissed away a 100 years of legacy. Production costs stayed too high for too long. They cut the engineering and development to save money until they no longer had the ability to create new products that were even remotely competitive. Game over. And guys $.05 a share is nothing, the real pain is the drop from $30. Edited July 14, 2006 by xr7g428 Quote Link to comment Share on other sites More sharing options...
one2gamble Posted July 14, 2006 Share Posted July 14, 2006 This is an important signal. Looks like some one thinks this stock should be worth about $4. Maybe less. Cutting the dividend tells the real owners of the company that the stock price is going nowhere. The chances for a turn a round in the near term are non existent. If the stock gets cheap enough it would make sense to part the sucker out. Still a lot of assets. There are still substantial cash reserves, real estate, and the names are worth something. Honda could get into the truck business with a Ford sub brand, side step the UAW and leap frog the competition. Volvo might be a way for Toyota to break down the market bartriers in Europe. Maybe Jag and Rover could be bundled up to some Chinese. I would bet in liquidation that it might be worth $30 a share... As a car company, Ford is done. They have pissed away a 100 years of legacy. Production costs stayed too high for too long. They cut the engineering and development to save money until they no longer had the ability to create new products that were even remotely competitive. Game over. And guys $.05 a share is nothing, the real pain is the drop from $30. they cut engineering and development yet they spend more on r&d than anyone Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted July 14, 2006 Share Posted July 14, 2006 (edited) "If the stock gets cheap enough" :blah: Ford is controlled by the Ford family. Anyone that buys Ford stock without being fully aware of this fact, with money they cannot afford to lose should be pitied for their ignorance, not their fate. As to the company being "through" because the dividend is cut. Well Gee, aside from the whole 'jumping to conclusions' thing, I guess I always thought the first responsiblity of the company was to stay in business, not to give money away to people that sit on their butt. Nothing like whining about overpaid labor out of one side of your mouth while complaining about the elimination of a dividend that you do nothing to earn out the other side of your mouth. yeah yeah yeah, we know, you're a 'real' owner of Ford. And yet, somehow, I figure there are a lot of people with more at stake in the survival of Ford than you. If Ford puts their interests ahead of yours, and if Ford decides that they don't care about the stock price, I guess that's their prerogative. You don't like it? Run for a seat on the board. Edited July 14, 2006 by RichardJensen Quote Link to comment Share on other sites More sharing options...
sparks will fly Posted July 14, 2006 Share Posted July 14, 2006 Wow the same labor that is to high also owns more than the fair share of stock in this company. Talk about a boneheaded statement. Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted July 14, 2006 Share Posted July 14, 2006 Wow the same labor that is to high also owns more than the fair share of stock in this company. Talk about a boneheaded statement. Who? me? I think cutting the dividend was the right thing to do. Saves a bit of money that will, all jokes aside, help defray some of the costs of the warranty extension (not like there's a direct connection between the two events). Quote Link to comment Share on other sites More sharing options...
sparks will fly Posted July 14, 2006 Share Posted July 14, 2006 Not you Richard I was refering to xr7g428's post. Since many workers white and blue collar in this company choose Ford stock in thier 401 plans I'd say many own more than some small time investor off the street, I personally have more than 5000 shares of this pig waiting for the long haul, and I do mean long. Quote Link to comment Share on other sites More sharing options...
RancorKeeper Posted July 14, 2006 Share Posted July 14, 2006 (edited) My biggest concern about cutting the dividend is it affects how much money I can reinvest into buying Ford stock. As a general rule, most shareholders use dividend returns to purchase more stock; lessen the shareholders' ability to do this & they may very well sell it all & move on to some other investing opportunity. If enough people do this, I think it becomes something to be concerned with. For instance, I've held on to my Ford stock for over five years now, but in that same timeframe, two of my mutual funds have dropped Ford from their portfolios. While I often don't agree with Wall Street's opinion of Ford's future performance I won't ignore the fact that, as a whole, those analysts have a direct effect on Ford's bond rating & that has cost implications, especially if it keeps getting lowered. As ignorant as Wall Street seems to be of the auto industry, that's reality & I think Ford needs to start doing something to turn around analyst opinion. Cutting the dividend isn't helping. Edited July 14, 2006 by RancorKeeper Quote Link to comment Share on other sites More sharing options...
johnnyb82 Posted July 14, 2006 Share Posted July 14, 2006 (edited) "If the stock gets cheap enough" :blah: Ford is controlled by the Ford family. Anyone that buys Ford stock without being fully aware of this fact, with money they cannot afford to lose should be pitied for their ignorance, not their fate. As to the company being "through" because the dividend is cut. Well Gee, aside from the whole 'jumping to conclusions' thing, I guess I always thought the first responsiblity of the company was to stay in business, not to give money away to people that sit on their butt. Nothing like whining about overpaid labor out of one side of your mouth while complaining about the elimination of a dividend that you do nothing to earn out the other side of your mouth. yeah yeah yeah, we know, you're a 'real' owner of Ford. And yet, somehow, I figure there are a lot of people with more at stake in the survival of Ford than you. If Ford puts their interests ahead of yours, and if Ford decides that they don't care about the stock price, I guess that's their prerogative. You don't like it? Run for a seat on the board. I guess this is directed towards me, but I never have whined about overpaid labor myself. Nor did I claim to be the real owner of Ford. I actually agree with cutting the dividend in a lot of ways. I bought Ford stock for the long haul and I want the company to survive and prosper and I am not sure of the point of paying out dividends if Ford struggles to pay its bills. I just resented the idea that this was good because it stuck it to the stockholders. I am not rich (I am a grad student and the $ came from my frugality from part-time jobs) and I thought that stockholders and workers, who are often the same, would both be interested in the long-term health of the company. Listen, I knew the risks of this company when I bought my small amount of stock and I am not blaming anyone but myself for the money so far that I have lost. And let me tell you why I bought this stock. It was probably a stupid reason. I don't know a person my age who has much respect for American makes of cars. My father grew up on a farm in a Ford family. Their tractors were Ford and their trucks and cars were Ford. Up until a couple of years ago, all he bought was Ford. Then he moved on. He was tired of mechanical problems and Ford no longer offered him the vehichles that he wanted. Now my whole family won't buy Fords, except me. I don't know why I keep with Ford both when it comes to my car and when it comes to my investing. I don't know why I spend time trying to defend Ford's product when others dismiss them as crap. I guess I think these products have been unfairly maligned, perhaps I believe in an American car company being able to do things better despite their disadvantages. Perhaps I believe that the engineers, assembly workers and everyone else at Ford can compete with anyone else and that they believe in their company if not always their management. I guess I am just ignorant, please pity me. Edited July 14, 2006 by johnnyb82 Quote Link to comment Share on other sites More sharing options...
hoss96racing Posted July 14, 2006 Share Posted July 14, 2006 Not all stockholders are rich and many have lost a lot of money already on a company they believed in enough to risk their hard-earned savings. thats why you have to diversify... you put all your eggs in one basket and your bound to get screwed... Quote Link to comment Share on other sites More sharing options...
johnnyb82 Posted July 14, 2006 Share Posted July 14, 2006 thats why you have to diversify... you put all your eggs in one basket and your bound to get screwed... I am diversified, but that's not really the point. Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted July 14, 2006 Share Posted July 14, 2006 I guess this is directed towards me Wrong guess. Seems to be a lot of misunderstanding on this board. That remark was directed mostly to xr7, or rather to the market analysts that are more interested in Ford's stock price and dividend than the overall health of the company. Hello, analysts: Ford stock is in the toilet--do you think cutting the dividend makes it materially LESS attractive? Analysts are griping because they're being ignored. I suppose they figure that the more they rant, the more likely it is that Ford will pay attention to them. Fact is Ford secured a fair amount of operating capital relatively cheaply in 2003, they have several billion in cash that is not required to meet immediate obligations, and they have been cash flow positive for years. Ford is in something of a liquidity crunch in that--if they have to--it will be very difficult for them to raise a lot of money quickly. Fortunately, Ford is unlikely to find itself in that position. People that say Ford has a 'liquidity' problem are overstating the issue. Ford has had the cash required to upgrade plants as new products are launched. They have the cash required to invest in overseas capacity, and they have the cash required to invest in new product. Ford has an 'access to liquidity' problem. If they don't have the cash on hand, it will be very expensive for them to obtain it. That's it. The situation is comparable to this: You have $30,000 in cash under your mattress, and you have a bad credit history. You also have a job. Right now your expenses are higher than your income to the tune of, oh, say $500 a month. Do you have a liquidity problem? No. Obviously you need to increase your income, and you should work to improve your credit history; however, you are not in danger of imminent financial ruin. Quote Link to comment Share on other sites More sharing options...
goblue93 Posted July 15, 2006 Share Posted July 15, 2006 The situation is comparable to this: You have $30,000 in cash under your mattress, and you have a bad credit history. You also have a job. Right now your expenses are higher than your income to the tune of, oh, say $500 a month. Do you have a liquidity problem? No. Obviously you need to increase your income, and you should work to improve your credit history; however, you are not in danger of imminent financial ruin. Yet the street is worried you will declare bankruptcy. Quote Link to comment Share on other sites More sharing options...
marc-o Posted July 15, 2006 Share Posted July 15, 2006 (edited) Aside from either extreme viewpoints in this thread (one being Wall St analysts are full of it and have no idea what they are talking about, the other being this is completely insignificant other than to harm innocent small-time investors): Fact is cutting your divident means you anticipate needing more money than you currently have coming. It's a way of cutting your expenses like asking your landlord for a rent cut: Dividends sustain stock price to some extent (and a perception of value of the company, in that it is able to consistently generate enough money to pay a "profit" to its owners), and lowering this payout inevitably implies there is less profit to go around. It's something that (for well-established companies like Ford) is (rightly or wrongly) seen as a confirmation of your status as a dependable business. While cutting the dividend is a move that should probably have been done a while ago, it wasn't because management didn't think it was truly necessary. The fact they are doing so this late in the game (the "turnaround" that is) clearly signifies things are not going as planned and whatever targets they had in mind were no longer seen as attainable - that's why this is bad news, although it's not the end of the world, since it means management still has a pulse. Edited July 15, 2006 by marc-o Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted July 15, 2006 Share Posted July 15, 2006 (edited) My point about all the hew and cry over cutting the dividend is that nobody should've been surprised by this (like the decision to cut GM and Ford to junk status). So it completely escapes me why this should be seen as a reason to further dismiss any hope of recovery. It's like "gee, so Ford is looking to cut costs, and instead of squeezing an extra nickel off the cost of a wiring harness, they're taking money away from the stockholders this time." BIG DEAL. The dividend was obviously not 1) reassuring investors that Ford was stll a solid investment, or 2) propping up the stock price, so why keep it? In fact I'd argue that the dividend (which represents a cost equal to over 10% of their R&D budget) should've been stripped a long time ago. Basically when Ford & Fields decided they didn't give a rats ass about their stock price. I mean if Ford has to slash blue-collar employment, white collar employment, and close over a dozen plants (impacting the lives of thousands of people), I don't see any reason why investors deserve an ounce of additional consideration. Edited July 15, 2006 by RichardJensen Quote Link to comment Share on other sites More sharing options...
marc-o Posted July 16, 2006 Share Posted July 16, 2006 So it completely escapes me why this should be seen as a reason to further dismiss any hope of recovery. If anything I think it's a sign the recovery is not going as planned... at least at this stage in the game. Like you said, if Ford decided not to give a rats ass about the stock price and to go all out, and did not cut the dividend - then why cut it now? Because they didnt think that was necessary, but now it is. At least that's the only rational reason I can come up with... Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted July 16, 2006 Share Posted July 16, 2006 If anything I think it's a sign the recovery is not going as planned... at least at this stage in the game. Like you said, if Ford decided not to give a rats ass about the stock price and to go all out, and did not cut the dividend - then why cut it now? Because they didnt think that was necessary, but now it is. At least that's the only rational reason I can come up with... Higher than expected material prices before Ford has been able to reduce labor overhead would be my guess where the squeeze is coming from. Also necessity is a difficult thing to assert, when you're talking about .2% of overall revenue. Heck, I think Nickf1011's flip remark tying the extended warranty to the dividend reduction might have some truth to it. Increasing the warranty will increase warranty costs. So..... Why not pull that money from the dividend? Instead of pulling it from marketing budgets or elsewhere? Ford sells 3M vehicles a year in the U.S. $350M means a budget of roughly $100/car/year in added warranty costs, which I think is a reasonable allowance. Quote Link to comment Share on other sites More sharing options...
foxrun Posted July 16, 2006 Share Posted July 16, 2006 (edited) Higher than expected material prices before Ford has been able to reduce labor overhead would be my guess where the squeeze is coming from. Also necessity is a difficult thing to assert, when you're talking about .2% of overall revenue. Heck, I think Nickf1011's flip remark tying the extended warranty to the dividend reduction might have some truth to it. Increasing the warranty will increase warranty costs. So..... Why not pull that money from the dividend? Instead of pulling it from marketing budgets or elsewhere? Ford sells 3M vehicles a year in the U.S. $350M means a budget of roughly $100/car/year in added warranty costs, which I think is a reasonable allowance. Hey Richard, may I say I told you so about the warranty? Its about time Ford did it, ya it costs more but the loss of sales costs even more. I believe in the Ford product and now the general cosumer has a reason to as well. Also I applaud the dividend cut to help pay for the extra warranty costs. That is a direct approach to giving back to the consumer. I'm also glad I haven't bought any Ford shares yet. Edited July 16, 2006 by foxrun Quote Link to comment Share on other sites More sharing options...
Ron W. Posted July 16, 2006 Share Posted July 16, 2006 Increasing the warranty will increase warranty costs. So..... Not if engineering does their job before the vehicle is released and the build quality goes up. Why is it one 6.0L owner says thats the best diesel i've ever owned while the next is pursueing lemon law and using lots of foul language? Quote Link to comment Share on other sites More sharing options...
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