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Friday, August 18, 2006

Ford Takes A Third Strike

Stocks: (F)

It is almost unimaginable that Bill Ford keeps his job. Sure, his family owns voting control of the big car company, but you would think they would be getting tired of the value of those holding dropping by the day. The Las Vegas odds have to be improving that he will be sacked by year's end.

Ford announced yesterday that it was looking at closing more plants, cutting salaries and a number of other moves to save more money. As many as 6,000 salaried worker will lose their jobs. For now, Bill Ford will keep his.

Lost in all the restucturing news is the fact that Ford's US market share has dropped from 25.7% in 1995 to 18.1% in the first seven months of this year. A number of media reports indicate that the amount of time its takes Ford to introduce new models is longer than any of its large rivals, making its ability to replace old models in time to stop its eroding share almost impossible. And a recent Univeristy of Michigan study showed Ford vehicles had more defects that those of any of their primary competition.

"The Way Forward" is now officially dead.

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