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Zacks Investment Research

Ford Motor Company (F) - Bear Of The Day

By Zacks Investment Research on March 26, 2009 | More Posts By Zacks Investment Research | Author's Website

Ford Motor (F) is one of the largest automobile manufacturers in the world. We believe that the company should file for bankruptcy to rid itself of Unions, pension and healthcare issues, and separate dealerships from the rest of the company.

The U.S. government should provide $25-$50 billion in aid, which will act as DIP ["debtor-in-possession"] financing. Any aid should force the company to only make 35MPG+ vehicles.

Management should be purged and outsiders brought in. Tariffs and quotas should be implemented for imported vehicles from overseas. Consumers should be allowed to deduct their automotive interest.

Lastly, global alliances should be forged among producers in North America, Europe and Asia. From an equity holder’s perspective, these compels us to rate the shares a Sell with a six-month target price of $0.00.

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