Ford announced a profitable 3rd quarter yesterday – which was way out of line with the losses declared at Government Motors (GM) and Chrysler. I didn’t read the release in depth but I saw these 2 numbers:
Profit: almost $1 billion
Additional debt since 2nd quarter: $800 million
Let’s analyze this. If I told you I earned $80,000 this year, but my expenses were $80,000 but that I also got $20,000 from welfare (don’t ask how just run with it), would you agree with me if I told you that I had a “profitable” year?
Perhaps some expenses were capitalized and debt was used to cover them? Perhaps the Cash for Clunkers thing boosted results (they did)? Ford Motor Credit’s division had pretax profit of $677 million – so much of this came from loans and leasing and with people losing jobs, I’m not sure I want to count on that. So what are all the details? I don’t know and I’m not too motivated to find out but if you’re interested in Ford, this may be a useful piece of data to research…