The MSM keeps telling me that auto sales are skyrocketing. They tout this as proof the consumer is back. Then why is Ford slashing their profit forecast by $1.5 billion? Why are their North American profit margins crashing? Why hasn’t their stock price moved at all in the last year? Why is their stock price 25% lower than it was in 2011? Why is GM’s stock price down 25% in 2014 YTD? Why is GM’s stock price still 20% lower than it was in 2011? Why are dealer lots overflowing with inventory?
The reason none of this computes is because the auto recovery is a farce. The “fantastic” sales are nothing but a debt financed bonanza created by the Fed’s easy money. Subprime financed auto”sales” are just pre-repossession gifts to deadbeats. Leases are nothing but short-term rentals to math challenged dumbasses which will be flooding dealer lots over the next few years. Even the legitimate sales are being financed at 0% for 7 years. This auto recovery is nothing but smoke and mirrors.
Ford sharply cuts full-year profit outlook
By Mike Ramsey
Published: Sept 30, 2014 8:21 a.m. ET
Just three months into the top job at Ford Motor Co., Mark Fields slashed the auto maker’s full-year profit outlook on rising troubles in emerging auto markets and costs from quality troubles and U.S. recalls.
Mr. Fields told investors on Monday the nation’s No. 2 auto maker by sales expects to report pretax profit this year of between $6 billion and $7 billion, approximately $1.5 billion less than it had forecast in July.
The largest factors: a roughly $1 billion larger tab for warranty and recall costs, a $300 million hit from declines in Russia, and a loss in South America that is $900 million larger than forecast. Better than expected unit volumes and pricing helped offset some of the shortfalls, it said.
Ford shares closed down 7.5% at $15.11 in 4 p.m. trading, the lowest close since March, and continued falling after-hours.
“The big shock today was the margin forecast given for North America,” said Brian Johnson, Barclays auto analyst. Despite high expectations for the 2015 F-150 pickup truck, Ford’s outlook for the rest of the year implies North American operating margins of between 8% and 9%, down from 11% last quarter.
The company now expects Europe to lose $1.2 billion on a pretax basis in 2014 and projects the red ink there would flow into 2015, although at a lower rate. Ford no longer expects European auto demand to return to prerecession sales levels even by 2020.
Ford also is suffering quality problems and has recalled 3.9 million U.S. vehicles so far this year, according to National Highway Traffic Safety Administration data.
Mr. Fields took over from former CEO Alan Mulally in July, and on Monday led a team of executives in laying out a road map for the business through 2020. While the company pointed out bright spots in Asia, North America and its Lincoln luxury brand,
Mr. Fields said the weak short-term outlook isn’t casting a shadow over his early days as CEO. He said the company is “looking at reality and dealing with it in a proactive way.”
More MSM lies. There is no recovery there never was a recovery and there isn’t going to be a recovery any time soon. We will experience a melt down first. We cannot recover from 18 trillion dollars and counting debt. Not possible.
I think I will start calling new-car renters, “future walkers,” and big-union companies, “future workplace shooting sites.”
When a person’s world is destroyed, say like by losing a job you thought was going to pay you FOR LIFE, and you realize the past 40 years your union, employer and government colluded to ship our futures offshore while lining their own pockets, people start to become filled with either despair, or rage.
Now imagine a country FULL of citizens that have been kept coddled and misled and in the dark for their entire lives, imagine what these closeted peoples are going to go through when they start to learn the things we are trying to prepare for.
Shit is going to hit the fan in a way never seen by man before.
For now I wait, prepare, and accept that I, we, are the crazy ones. Until the day we are proven sane and going Postal becomes a national obsession.
Mr. Fields might consider switching over to selling cookies, along with his wife, Mrs. Fields.
TE ,so you admit your ready for the SHTF ,you do realize in order to survive all you have to do is do what comes naturally to humans. We humans are natural born killers regardless of the people who say humans have an aversion to killing other humans. I go with historical account . I think people wish other people were good and decent but that’s just another lie we tell ourselves so as to avoid the TRUTH about our own self.
Do you agree?.If not you want make it one week in a real shtf situation. Read the accounts of the war in Bosnia , Lebanon or now in Syria.
I am beginning to like you so don’t screw it up.
@bb, ready? Not by a long shot, how can one be “ready” for the end of the world as you know/thought it?
But, let’s say, open-eyed and minded. Which I have been for a long, long, long, time.
So, don’t screw it up you say, how cute.
I take back my comment above. The stock market ,Housing sales and autos are all positive. Looks like things can’t get any better.
I think at least in the early stages of any mass meltdown, who survives will be a question of keeping a low profile and being able to defend yourself/family/stash against anyone or group who tries stealing it. Those who are having cognitive dissonance at the wrong moment will die/lose their shit. And for the record I’m ready (or at least think I am) and have been for some time.
My friend and I have a combined 30 years in the auto retail business and have always maintained:
A lease is nothing more than making a payment you can afford on a car you can not afford .
Retail consumer auto leasing is simply pulling tomorrows “sales” into current business reporting.
Shareholder driven greed, much like the rest of ‘murikan economy. All smoke and mirrors…..
BOOMING AUTO SALES??????
Ford September U.S. sales fall 3%
By Jim Jelter
Published: Oct 1, 2014 9:51 a.m. ET
SAN FRANCISCO (MarketWatch) — Ford Motor Co. F, -1.05% reported Wednesday it sold 180,175 cars and light trucks in the United States in September, a 3% drop from September 2013. Ford brand vehicle sales came in at 172,918, a 3.2% drop from a year ago, while Lincoln sales rose 12.7% to 7,257. Retail sales rose 2% while fleet sales fell 14%, largely due to the company’s phase out of its existing F-150 pickup while it prepares to launch a thoroughly redesigned, aluminum-bodied F-150 later this month. Ford shares were last down 0.8% following the report.
U.S. auto sales decline from fastest pace in 8-plus years
By Ruth Mantell
Published: Oct 1, 2014 3:15 p.m. ET
WASHINGTON (MarketWatch) — The annualized sales pace of light vehicles declined to a seasonally adjusted 16.43 million last month, pulling back from August’s 17.53 million, which was the fastest rate since January 2006, Autodata reported Wednesday. Economists polled by MarketWatch had forecast a pace of 16.5 million for September. Last month’s drop was driven by an 8% decrease for cars, and a 5% decline for trucks.