Monday, May 22, 2006

Blog of the Week: 24/7 Wall St.

Is There A Ford In Ford's Future F, GM, DCX

Now that Ford's (NYSE:F) chief operating officer, Jim Padilla, has announced his retirement at 40 years at the company, and is heading out the door, the question is whether Bill Ford will be next. He should be.

According to the Associated Press, a JPMorgan survey of the credit markets now puts the chances of a Ford bankruptcy at 43%. Call it Las Vegas for investment bankers.

The structure that gives the Ford family a super-majority of voting shares and effective control of the company remains in place, which means that shareholders and the board have little say in what happens to the company.

The company still plans to cut 30,000 jobs, but if Ford's market share, especially in North America, continues to shrink, it may not be nearly enough. The labor problems that the company shares with GM (NYSE;GM) and DaimlerChryler (NYSE:DCX) are not going away. Chrysler recently added dealer incentives to reduce inventory, and Ford and GM may be forced to match them to keep share.

Ford's truck sales fell 14.5% in April, which is tough, since this is...



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