Ford Loses $5.9 Billion, Cuts 1,200 Jobs

Jan. 29, 2009
Won't seek U.S. aid

Ford Motor Co. announced on Jan. 29 a quarterly loss of $5.9 billion but said it had "sufficient liquidity" to fund its turnaround plan without U.S. government aid.

"Based on current planning assumptions, it does not need a bridge loan from the U.S. government, barring a significantly deeper economic downturn or a significant industry event, such as the bankruptcy of a major competitor that causes disruption to the companys supply base, dealers or creditors," Ford said. The company finished 2008 with $24 billion in available liquidity for its auto operations including $13.4 billion in cash.

Ford said it would cut 1,200 jobs at its Ford Motor Credit unit in response to weak conditions.

Ford's loss in the fourth quarter was more than double the deficit in the same period in 2007 of $2.8 billion. Revenues plunged 33% to $29.2 billion in the period, amid weak sales and the divesting of its Jaguar division.

For all of 2008, Ford posted a whopping loss of $14.57 billion, compared with a $2.7 billion in all of 2007. Revenues for the year fell to $146 billion from $172 billion.

"We continued to take the decisive actions necessary to lower production to match the lower worldwide demand and reduce costs, which we expect will allow us to significantly reduce negative operating cash flow in 2009 and position Ford for growth when the economy rebounds,"said Ford CEO Alan Mulally.

Copyright Agence France-Presse, 2009

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