News
Ford says struggling Premier Automotive Group will make money in '06
AMY WILSON | Automotive News
Posted Date: 11/29/05
DETROIT -- All of Ford Motor Co.'s overseas automotive operations will make money in 2006, including the struggling Premier Automotive Group, CEO Bill Ford says.
But he wouldn't predict when the company's most important unit, the troubled North American automotive business, would return to profitability. That unit lost $1.4 billion during the first nine months of 2005.
While not saying North America's losses would continue in 2006, Bill Ford acknowledged that business will be difficult as Ford Motor takes significant restructuring steps next year.
"The tougher actions we'll have to take could impact the short-term performance but are the right things to do for the long term," Bill Ford said in an interview with Automotive News. "But the rest of the Ford automotive world I expect to be profitable throughout next year."
Forward plan
Ford Motor will forecast 2006 earnings targets for the individual businesses in January. That is also when the company plans to announce a restructuring plan internally dubbed the "Way Forward."
The plan will result in several plant closings and thousands of job cuts. Mark Fields, new president of the Americas and chief architect of the plan, told employees in a Nov. 18 e-mail that Ford Motor would cut about 4,000 North American salaried jobs early next year.
Though Bill Ford expects PAG, Ford Motor's collection of luxury brands, to make money in 2006, Jaguar continues to struggle. "We still have not figured out how to make the business equation yet for Jaguar a compelling one," Bill Ford said. "It's better than it was. But the infrastructure was put into Jag for growth aspirations that, in retrospect, were just out of line."
In 2004, Jaguar abandoned a goal to increase annual global volume to 200,000 vehicles. Ford closed Jaguar's historic Browns Lane plant in England this year.
Joe Greenwell, then Jaguar-Land Rover CEO, said in May at the Automotive News Europe Congress that he doesn't expect Jaguar to break even before 2007. Ford Motor produced 118,000 Jaguar-branded cars in 2004. Greenwell, who now is vice president of government affairs for PAG and Ford of Europe, said 2005 volume would be substantially less.
Tough 2005
PAG turned a profit in 2003. Dragged down largely by the red ink at Jaguar, PAG lost $740 million before taxes in 2004. And despite earlier forecasts for a money-making 2005, a full-year profit seems unlikely this year, too.
PAG lost $146 million before taxes through the first nine months of 2005. Ford Motor promises the unit will make money during the fourth quarter, but executives won't say whether the gain will be enough to erase those earlier losses. Executives do admit that PAG will fall short of its 2005 goal of at least $300 million in pretax profits.
http://www.autoweek.com/news.cms?newsId=103678
IN OTHER NEWS... i think kinna related...
Industry: Ford cuts Volvo workforce
29 Nov 05 14:39
Ford is cutting 5.3% of the workforce at its Volvo Cars division to reduce spending and boost earnings.
The carmaker will make 1,470 workers redundant, primarily in Sweden and Belgium, out of a total workforce of 27,500 people.
Volvo will eliminate 1,020 jobs in Sweden, 720 of which are permanent positions within the company and 300 are temporary consulting and services jobs, the company said. The remaining 450 job cuts will come at Volvo's assembly plant in Belgium.
"We have to reduce the number of employees we have in order to be more effective in the future," Christer Gustafsson, a Volvo spokesman, said in an interview. "We are reviewing all cost-driving areas within the company."
The cuts at Volvo come on top of a worldwide reduction Ford announced Oct. 20 of 10,000 positions by year-end through attrition and eliminating jobs. The Volvo reductions are not part of that plan, Gustafsson said.
Sales by the Ford in Europe fell 3.5% in the first nine months of the year to 998,436 vehicles. Including the company's Volvo, Jaguar, Land Rover and Aston Martin brands, sales fell 3.3% to 1.29m vehicles.
Worldwide sales of Volvo-brand vehicles fell 1.5% to 373,798 units in the 10 months ended October 31, Gustafsson said. In Europe, the company's sales fell 0.9% to 205,392 vehicles, according to the European Automobile Manufacturers Association. (Detroit Free Press)
http://www.channel4.com/4car/news/ne...?news_id=13489
yeah one way to make money... fire more ppl..
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