This merger won't work. Look what happened to Lockheed in the 70's. When GM laidoff workers at their Van Nuys auto assembly plant most of the workers were hired by Lockheed to assemble the L1011 Tristar plane. These workers had no knowledge of airplane assemlbly and they had to be trained. Lots of errors where made during the assembly of the plane. Time and money was waisted. Lockheed sales of the L1011 dropped when Boeing introduced the DC-10. Assembling a plane is not the same as assembling an auto. History will repeat again.
No one will buy ford.... not the company or the cars.
Shut up with the Ford merger/buy out talks. No company would pay this much of a premium above book value for all of Fords debt and problems. You might see buyout talks if ford files chapter 11. That would only be to gut it and keep the name. If a merger is your reason for owning ford then you are seriously mentally handicapped.
No one will buy the cars because they are generally inferior to the imports.
Thanks for posting. Why someone couldn't have said this before is beyond me. I guess they were too caught up in their own hype.
Since it came from Cramer, I don't put much value in it ...
>>I believe that they think that they would be better off to rule in hell than serve in heaven.<<
This, coming from a guy who screamed "buy buy buy!" dot-com stocks literally days before they crashed ...
>>We are buying some of every one of these this morning as I give this speech. We buy them every day, particularly if they are down, which, no surprise given what they do, is very rare. And we will keep doing so until this period is over -- and it is very far from ending.<<
Less than two weeks later, the NASDAQ started its meltdown.
My cup of coffee stays hot longer than Cramer's advice. Here's the basis for the rumor. In the meantime, it smells like $8.30's are brewing and on to $8.20's before eventually ending up below $8.00 in the coming days.
Boeing (BA - commentary - Cramer's Take - Rating) to merge with or acquire Ford (F - commentary - Cramer's Take - Rating).
Why it makes sense: This sounds like a real wacky match, but the more I think about it, the more it might make sense. So hear me out.
Airplane, defense, automotive and truck manufacturing all require similar (but not necessarily the same) raw-material inputs and parts. Thus, a combined manufacturing effort would have economies of scale in terms of component and material purchasing.
Make the deal subject to a one-time, take-it-or-leave-it labor agreement, focusing on pensions and benefits. Get rid of the defined benefit programs. Ford Motor Credit and Boeing Capital can create a very powerful financial-services company. Consolidate the overhead and eliminate other wasted costs.
A healthy Ford without all of the recent writeoffs can probably make $1.50 per share. If you clean up the balance sheet, it might be more. Heck, if done right, this could be accretive to Boeing.
Why it might not happen: It's just too complex. Expecting the United Auto Workers to cave in would be expecting a miracle. Furthermore, I doubt if the Ford family egos would permit losing control of a failing company to having a hefty stake in a healthy one. I believe that they think that they would be better off to rule in hell than serve in heaven.