2005 Ford Five Hundred Se Sedan 4-door 3.0l on 2040-cars

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Buy Ford and GM stock and make 5%

Want to make a five-percent return when 10-year treasuries are paying around two percent? Ford (F) and General Motors (GM) have solid balance sheets, strong cash flow, solid earnings, and growing markets. By all accounts, they are smart investments. But the market is down on these stocks. Why? Some of the stupid excuses include: They are cyclical companies The Detroit 3 have lost 3.5 million in sales since 2000 The world economy is shaky GM recently filed for bankruptcy Their markets have peaked They haven't changed their ways Let's take these criticisms one by one: They Are Cyclical Companies Yes, they are cyclical. Every company is cyclical. Every industry is cyclical. Some more than others, but not every company is immune from swings in the market. Banks used to be 'non-cyclical' leader, not anymore. Airline stocks are just as cyclical as auto stocks, yet they are trading at multiples greater than the auto industry. Why? And what accounts for the irrational stock price for Tesla (TSLA)? At least Ford (F) and General Motors (GM) make money and have positive cash flows. In fact, both companies have a net positive cash position. They have more cash on hand than liabilities. Auto sales in the United States hit a record 17.5 million vehicles in 2015. During the Great Recession, Ford (F) and General Motors (GM) cut their break even points to 10 million vehicles per year. Anything above an annual U.S. volume of 10 million vehicles is profit. And what a profit they make. Sales of Ford's F-150 continues to be the best-selling vehicle in the United States for over 30 years. Detroit 3 Have Lost 3.5 million in Sales Since 2000 Automotive News reports General Motors (GM), Ford (F) and Chrysler (FCA) have lost a combined 3.5 million vehicles sales since 2000. So how can they be making more money? Two big reasons – Fleet Sales and the UAW. Fleet Sales The Detroit 3 used to own car rental companies to keep their factories running. Ford owned Hertz (HTZ), General Motors owned all of National Car Rental and 29 percent of Avis, and Chrysler, the forerunner to Fiat Chrysler (FCA), used to own Thrifty Car Rental and Dollar Rent-A-Car. The Detroit 3 owned these rental companies to have a place to sell their bad product and keep their factories running. These were low margin sales, and in many cases, were money losers for the Detroit 3. They no longer own auto rental companies.

Driving the Lincoln Aviator and flogging Abarths at Laguna Seca | Autoblog Podcast #593

In this week's Autoblog Podcast, Editor-in-Chief Greg Migliore is joined by West Coast Editor James Riswick and Associate Editor Joel Stocksdale. To begin, Greg takes a moment to remember the fastest woman on four wheels and former host of Autoblog's "The List," Jessi Combs, who died this week. Then our editors turn their attention to the cars they've been driving, including the Lincoln Aviator, Ford Ranger and Nissan Frontier, as well as Joel's recent stint in the Fiat 500 Abarth and Fiat 124 Spider Abarth, including track time at Laguna Seca. Finally, they turn their attention to a listener in Germany who is looking to replace an aging Volkswagen Eos with a newer convertible in this week's "Spend My Money" segment. Autoblog Podcast #593 Get The Podcast iTunes – Subscribe to the Autoblog Podcast in iTunes RSS – Add the Autoblog Podcast feed to your RSS aggregator MP3 – Download the MP3 directly Rundown Remembering Jessi Combs 2020 Lincoln Aviator and Aviator Grand Touring 2019 Ford Ranger 2019 Nissan Frontier 2019 Fiat 500 Abarth and 124 Spider Abarth at Laguna Seca Spend My Money Feedback Email – Podcast@Autoblog.com Review the show on iTunes Related Video: This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings.  

Question of the Day: Worst year of the Malaise Era?

The Malaise Era for cars in the United States spanned the 1973 through 1983 model years, and featured such abominations as a Corvette with just 205 horsepower (from the optional engine!) and MGBs with suspensions jacked way up to meet new headlight-height requirements. There were many low points throughout this gloomy period, of course. The horrifyingly low power and fuel-economy numbers for big V8s during the middle years of the Malaise Era make a strong case for 1974 or 1975— the years of Nixon's resignation and the Fall of Saigon, respectively— as the most Malaisey years. But then the GM-pummeling debacles of the Chevy Citation and Cadillac Cimarron could make an early-1980s year the low point. 1979, the year of the ignominious Chrysler bailout? You choose! Related Video: