Ford ponders how to turn things around

The Wall Street Journal reported Wednesday that Ford is starting a review of poorly performing units, including Jaguar, with an eye toward the possible sale of some operations. But some analysts note that Jaguar is intertwined with Ford on purchasing, manufacturing and distribution — making a sale complex.

Bill Ford, meanwhile, asserted that the company has benefited from turnaround efforts.

"Contrary to speculation, nothing has been decided and we will not rush to judgments," he wrote in his e-mail. "I'm proud of the progress that our operating units and brands around the world are making."

Ford's recent problems come as GM logs milestones in its major restructuring announced in November. GM recently reported it lost $3.4 billion in the second quarter because of heavy charges for layoffs and early retirements, but without those charges the world's largest automaker scored a profit that bolstered management's claim that the turnaround is working.

GM and Ford both have been trying to deal with towering health care and pension costs for their workers. But Japanese automakers continue to add pressure. Last month, U.S. sales at Ford, GM and DaimlerChrysler AG's Chrysler Group all dropped, while Toyota and Honda Motor Co. made gains.

Dearborn-based Ford's "Way Forward" plan, launched in January, calls for shedding 25,000 to 30,000 jobs and closing 14 plants by 2012 to help return Ford's North American automotive operations to profitability. But the company has faced criticism from Wall Street that it isn't doing enough.

Ford, which has been losing market share to Asian manufacturers for a decade, has been badly stung by high gas prices because big trucks and SUVs account for nearly 70 percent of the vehicles it sells. Analysts say any more job or plant cuts must be accompanied by new, appealing vehicles outside of the realm of trucks and SUVs.

"It's difficult to cut your way to success," said Michael Robinet, vice president for global forecasting at the auto industry consulting company CSM Worldwide. "It's going to come down to product."

Ford has said it is making strides. The automaker has touted the Ford Edge and Lincoln MKX coming out later this year in the important crossover segment. Crossovers have many of the attributes of SUVs but are built on a car platform. But analysts note Ford has tough competition in crossovers.

Cole, director of the Center for Automotive Research in Ann Arbor, said automakers such as Ford are trying to wean themselves from the use of deep-discount incentive programs to help sell their vehicles. Instead, he said Ford needs to improve its manufacturing flexibility so it can quickly meet consumer demand.

Despite the automaker's recent string difficulties, Cole said Bill Ford remains secure in his job.

"The key right now is not a change of Bill Ford," Cole said. "It is accelerating the restructuring."

On Thursday, Ford recalled 1.2 million trucks, sport utility vehicles and vans amid concerns about potential engine fires. The news, which builds upon one of the largest recalls in U.S. history, came a day after Ford said that its second-quarter loss more than doubled from what it previously reported because of higher-than-expected pension costs. And Ford said that its luxury division will not be profitable this year.

Ford shares closed down 10 cents, or 1.4 percent, to $6.86 Thursday on the New York Stock Exchange after closing up 38 cents, or 5.8 percent a day earlier.

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