While GM and Chrysler are requesting a total of $11 billion in loans by the end of 2008, rival FoMoCo is not requesting anything. Nonetheless, Ford is losing billions of dollars and sales have declined nearly 21 percent this year so executives are having a hard time convincing the public that Ford is Detroit’s healthy automaker.
Ford’s CEO Alan Mullay mortgaged most of the automaker’s assets in 2006, giving it nearly $30 billion in cash. According to Automotive News, despite losing $8.7 billion so far in 2008, Ford can still survive 2009 if sales are at 12.2 million.
However, Ford’s long-term recovery is facing a major obstacle and that is public skepticism and good PR relations. Ford was the only company during congressional hearings that reported profits in the first quarter. CEO Alan Mulally frequently pointed out that Ford is not requesting any direct loans at the time. Instead it is seeking a $9 billion line of credit that Mulally hopes he won’t need to access unless the economic crisis gets worse.