A Huge Sign of Progress for This Automaker

Before you go, we thought you'd like these...
Before you go close icon

In today's edition, industrials editor and analyst Brendan Byrnes discusses a deal that General Motors is closing in on that would give it the ability to cut back hours from 35 per week to 31 at two German plants that employ around 16,000 people. Europe continues to have a chronic overcapacity problem: Factories are producing too many vehicles for a market that's expected to see sales declines for the fifth straight year. This might not sound like a big deal for GM, but it shows that the company understands the problem and has a sense of urgency about fixing its operations in Europe. It could also potentially save the company quite a bit of money in the short term, something badly needed as both GM and Ford struggled and posted huge losses in Europe last quarter.

Europe is one of the main reasons that GM and Ford have underperformed this year. Looking specifically at Ford, the company is making good vehicles, is consistently profitable, recently reinstated its dividend, and has done a remarkable job paying down its debt. With Ford's stock sitting at around 6 times forward earnings, does this create an incredible buying opportunity, or are there hidden risks with the stock that investors need to know about? To answer that, one of our top equity analysts has compiled a premium research report with in-depth analysis on whether Ford is a buy right now, and why. Simply click here to get instant access to this premium report.

Austin Smith owns shares of Ford. Brendan Byrnes owns shares of Ford and General Motors. The Motley Fool owns shares of Ford. Motley Fool newsletter services recommend Ford and General Motors. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners