Europe woes won't derail Ford's momentum: execs
"So we have to guard against that."
Ford has spent the last six years revamping the business, lowering its break-even point and cutting fixed costs, which made the company less responsive to changes in the economy.
Ford analyzed a variety of scenarios before doubling the dividend, including running financial tests that factored in a much more serious downturn in Europe, Chief Financial Officer Bob Shanks told reporters.
"Even based on doing some severe downturn scenarios, we felt we could sustain this dividend," Shanks said.
Mulally is credited with turning around Ford while avoiding the federal bailouts needed to save its crosstown rivals General Motors Co and Chrysler Group LLC in 2009. Under his "One Ford" strategy, Ford has adopted global platforms that allow the company to achieve economies of scale.
"The structure of the business, particularly here in North America, has improved so dramatically that we could make money on just about everything in the lineup," Shanks said.
Ford is now adopting a similar turnaround strategy in Europe, where Ford expects to lose at least $3 billion in 2012 and 2013 combined, hurt by the economic slowdown and underused factories in the region.
Over the next three years, Ford will also expand its footprint in Asia in an attempt to avoid a possible over-reliance on North American operations, where its F-150 pickup truck has long been the top-selling vehicle.
The changes to the
Be the first to comment.