Your SlideShare is downloading. ×
(CEFAM) FIN220 - GM/Ford
Upcoming SlideShare
Loading in...5
×

Thanks for flagging this SlideShare!

Oops! An error has occurred.

×

Saving this for later?

Get the SlideShare app to save on your phone or tablet. Read anywhere, anytime - even offline.

Text the download link to your phone

Standard text messaging rates apply

(CEFAM) FIN220 - GM/Ford

153
views

Published on


0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total Views
153
On Slideshare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
2
Comments
0
Likes
0
Embeds 0
No embeds

Report content
Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
No notes for slide

Transcript

  • 1. Bankruptcy  When businesses become insolvent, meaning they service their debts, they have two possibilities  Reorganization (Chapter 7)  IR down  Term to maturity up  Some debt exchanged for equity  Liquidation (Chapter 11)  When the company is deemed to be to far to be saved
  • 2. Part I
  • 3. Risks due to Political and EconomicSituation gas prices .> shift in demand: SUVs and light Volatility of trucks to smaller cars Slowing economic growth ->cars=durable goods-> purchases delayed Commodities prices -> GM/Ford dependent of steel and plastics Cessations of govt incentives on certain vehicles Geopolitical events such as war of restrictive customs are bad for the business Currency
  • 4. Comparisons
  • 5. 2.20Company Name Toyota Motor Corporation 2.10 2.10 Volkswagen AG 2.00Toyota Motor Corporation 1.93 Daimler AG 102,527 1.90 1.88 Tata Motors, Ltd. Corporation Toyota Motor 1.80 13.764 1.79Volkswagen AG400 Volkswagen AG 84,633 1.70 369.928 58.167 General Motors Corporation 8.102 Daimler AG 1.60 76.658 1.62Honda Motor Company 44,440350 1.50 1.50 General Motors Corporation 322.045 229.460 Daimler AG 1.40 General Motors CorporationDaimler AG 30,599 80.094 Ford Motor Company300 1.30 Ford Motor CompanyFuji Heavy Industries 273.216 Ford Motor Company 24,992 1.20 92.758 149.733 1.10 243.000 FiatHonda Motor Company S.p.A.250Industry Average Fiat S.p.A. 19,069 1.00 213.000 111.863 0.95 0.90 198.348 Nissan Motor Nissan Motor200 0.80Bayerische Motoren Werke AG 186.421 149.021 Honda Motor Company18,662 0.70 0.62 158.201 Fiat S.p.A. Bayerische Motoren Werke AGNissan0.60150 Motor Nissan Motor 18,128 0.50 0.59 Bayerische Motoren Werke AG Fuji Heavy IndustriesFiat S.p.A. 100.041 8,466 0.40100 0.30 Bayerische Motoren Werke AG 146.277 Industry Average Honda Motor CompanyFord Motor Company 0.20 6,535 148.979 36.364 Tata Motors, Ltd. 50 0.10 Toyota Heavy Industries Fuji Motor CorporationGeneral Motors Corporation 27.884 2,045 0.00 Fuji Heavy Industries 0 -0.10 0Tata Motors, Ltd. -0.11 1 Volkswagen AGLtd. Tata Motors, 1,966 -0.20
  • 6. +46.37 +26.44 -20.64 -95.17 +25.97 +8.88 -7.35 -60.49Years Sept. 2005 to May 2006 May 2006 to July 2006 July 2006 to June 2007 June 2007 to March 2009Auto & Truck +0% to +26.44% +26.44 to +5.80% +5.80% to +52.17% +52.17% to -43.00%Manufacturer +2644 basis points -2064 basis points +4637 basis points -9517 basis pointsS&P 500 Index +0% to +8.88% +8.88% to +1.53% +1.53% to +27.50% +27.50% to -32.99% +888 basis points -735 basis points +2597 basis points -6049 basis points
  • 7. General Motors Corporation Volume Carmakers Luxury BrandsChevrolet GM Daewoo GMC Holden Opel Buick Cadillac Pontiac Vauxhall Saab Wuling Saturn Hummer
  • 8. Ford Motors Company Volume Carmakers Luxury BrandsFord Mazda Mercury LincolnVolvo
  • 9. GENERAL MOTORS CORPORATION Dividend Max: $1.50FrequentDividend Dividend Min: Moderately Frequent No Dividend Dividend $0 FORD Moderately Frequent Dividend MOTORS COMPANY Dividend Max: $12.06 Frequent Dividend Min: Dividend $0 No Dividend
  • 10. 60% 50 120% 101 50% 101%50% 100% 1st Quarter40% 31% 1st Quarter 80% 28% 26% 25% 2nd Quarter30% 21% 2nd Quarter 60%20% 3rd Quarter 40% 24% 26% 24% 26% 3rd Quarter 11% 8%10% 4th Quarter 20% 0% 2% 2% 4th Quarter 0% 0% Net Sales and Net Income Net Sales and Net Income Revenue Revenue 46 804 46,519 46,80450,000 50,000 43,094 43,567 42,383 37,808 38,01040,000 1st Quarter 40,000 30,778 1st Quarter 30 778 30,00030,000 2nd Quarter 20,000 2nd Quarter20,000 10,000 891 3rd Quarter 62 3rd Quarter10,000 0 4th Quarter -722 4th Quarter -10,000 Net Sales and Net Income 0 Revenue -3,251 -20,000 Net Sales and Net Income-10,000 Revenue -2,542 -9,596 -30,000-20,000 -15,471 -40,000 -38,963 -38 963
  • 11. $M GM Ford GM Ford $ % $ % $ % $ %$M SalesNet 147 732 GM 100 129 166 Ford100 177 594 GM100 154 379 Ford 100Cost of good sold -149 723 $ -149 723 -101 % -127 103$ 103 -98 % -164 946 $ -93 % -142 587 -142 $ -92%Gross ProfitNet Sales -1 991 414 -1 -1 100 2 083 406 2 063 2 100 12 648 500 7 100 11 792 11 792 479 8100Cost of general andSelling good sold -415 -100 -100 -353 -87 -87 -460 -92 -92 -396 -83 -83administrative -13 147 -9 -11 356 -9 13 -13 590 -8 -13 660 -9 17Gross Profit -1 00 53 13 -40 -8 83 17expensesSellingincome andOther general -8 -40 -10 -10 -60 -15 0 -15 0 -40 0 -8 -59 -12 -2 -12administrative expenses -610(expense) net 0 0 -2 400Other income (expense) -15 748Operating Income -15 748-19 -11 -9 293 -9 293 -7 -7 -942 -942 -12 -1 -2 -4 268 -4 268 -3-2 -4 -2 -9netInterest expenses -884 -1 -1 938 -2 -1 042 -1 -2 252 -1Operating Income (loss)Interest income - -59 -14 -14 -14 -3 -3 -12 -2 16 33 0 0 -755 -1 0 0 1 161 1Interest -expensesGMAC -7 -2 -27 -7 -9 -2 -30 -6Income from affiliatedInterest income - GMAC - 0 1 0 0 163 0 0 0 0 4 0 1 389 1 0 0companyEarnings from continuingEarnings from -64 -16 -40 -10 -18 -4 -14 -3operations -16 632 -11 -11 823 -9 -1 984 -1 -4 970 -3continuing operationsIncome Tax -5 -5 -1 -1 0 0 0 0 -103 -103 -21 -21 44 1 1Income Tax (Loss) fromNet Income 0 0 0 0 0 0 0 0Equity income net of -17 -4 0 0 0 0 3 1affiliated companies 184 0 0 0 522 0 0 0taxEquity income net of tax 1 0 -1 0 1 0 -1 0Minority interests, net ofMinority interests, net of tax 103 0,3tax 0 0 0 0 0 0 -406 -1 0 0 0 0 0 0Income from continuedLoss before income taxoperations -16 345 0 -16 345 -11 0 -11 823 0 -11 823 -9 -9 0 -1 86813 -1 -1 3 -1 -4 9700 -4 970 -3 0 -3– automotiveNet earnings -86 -86 -21 -21 -41 -41 -10 -10 -108 -108 -22 -22 -8 -8 -2 -2
  • 12. $M GM Ford GM Ford GM Ford GM Ford $M $ GM $ Ford $ GM $ Ford GM Ford GM FordNet Sales 147 732 $ 129 166 $ 177 594$ 154 379 $ -29 862 -25 213 -17% -16%Cost Sales Net of good sold -149 723414 -127 103 406 -164 946 -142 587 500 479 15 -86 223 -86 -73 15 484 -73 -17% -9% -17% -15% -11% -15%Gross of good sold Cost Profit -1 991 -415 2 063 -353 12 648 -460 11 792 -396 -1445639 45 -9 729 43 43 -116% -10% -10% -83% -11% -11%Selling general and 39 -30 -98% -36% Gross Profit -1 53 -40 83 39 -30 -98% -36%administrative -13 147 -11 356 -13 590 -13 660 443 2 304 -3% -17% Selling general andexpenses -40 -60 -40 -59 0 -1 -1% 1%Other income expenses administrative -610 0 0 -2 400 -610 2 400 #DIV/0! -100%(expense) net (expense) Other income -19 -7 -12 -9 -7 1 56% -14% netOperating Income -15 748 -9 293 -942 -4 268 -14 806 -5 025 1572% 118%Interest expenses (loss) -884-59 Operating Income -14 -1 938 -12 -1 042 -2 25216 -47 -47 158 -29 -29 314 394% 394% -15% -187% -187% -14%Interest income - Interest expenses 0 -7 -755-27 0 -9 -30 1 161 02 3 -1 916 -31% 0 -11% -165%GMAC - income - GMAC - Interest 1 0 4 1 -2 -9 -68% -100%Income from affiliated Earnings from continuing 0 163 0 389 0 552 0 -58%company -64 -40 -18 -14 -47 -27 264% 197% operationsEarnings from Income Tax -16 632 -5 0 -11 823 -103 -1 984 4 -4 970 -1498 98 648 -4 -4 -6 853 -95% -95% 738% -105% -105% 138%continuing operations Net Income (Loss) fromIncome Tax affiliated companies 0 -17 0 0 0 0 0 3 -17 0 -30 0% 0 -86% 0%Equity income net of Equity income net of tax 184 1 0 -1 522 1 0 -1 -1 -338 00 -65% -65% -31% 0%taxMinority interests, net of Minority interests, net 0,3 0 -1 0 1 0 -127% 0% tax 103 0 -406 0 509 0 -125% 0%of tax Income from continuedLoss before income tax -16 345 0 0 -11 823 13 -1 868 0 -4 970 -14-13 477 0 -6 853 -100% 775% -78% 138%–operations automotive Net earnings -86 -41 -108 -8 22 -33 -20% 439%
  • 13. Market Segments GM FAutomotive Financial Automotive Financial FORD FORD GMNA GMAC NORTH AM CREDIT FORD GME SOUTH AM FORDGMLAAM EUROPE GMAP VOLVO FORD APA
  • 14. Market Segments Change GM 2008 GM 2007 3% Cars 2008 Cars 2007 41% 39%Trucks 2008 Trucks 2007 56% 61% Change 3% F 2008 F 2007 Cars 2008 Cars 2007 34% 31% Trucks 2008 Trucks 2007 63% 69%
  • 15. Risks due to production techniques Decline in market -> increase of cost/unit. Companies cannot reduce their capacity as quickly as they lose market shares Suppliers’ distress: Giving up financial support to them for avoiding bankruptcy Single source of components: Bankruptcy from the sole supplier Overcapacities (17M/year), very competitive market  Company incentives = pricing pressure -> Op. Margin decreasing
  • 16. Risks due to production techniques Decline in market -> Comparative Stock Price Suppliers’ distress & Single source of components:  Ford: 1,600 today; 750 in the future  GM: One large source of components  Delphi: Bankrupt since 2005 Op. Margin: Income Statement  Overcapacity of 24M in 2008, industry-wide (est.)  Pricing pressure due to Japanese and Korean competitors
  • 17. Risks from Strategy and R&D Lack of reliability or defects in new vehicles  Warranty stable , no delays, no recalls New laws:  Environmental law: California Capacity to succeed in implanting brands in emerging countries:  Ford Fiesta, Ford Edge and Ford Transit (last two ,good) Lower than anticipated acceptance of new vehicles.
  • 18. Risks linked to Credit Companies Credit Risk: Paymt Default & collection and servicing problems Residual Risks: Lower-than-expected salvage value = lower transaction profitability Strong competition: banks/other financial institutions Int’l: Credit Companies = Banks  Reserve Required Ratios Residential Mortgage: Weakness Interest Rates Change: Strong impact on the consolidated company  Banks and Portfolios
  • 19. Income Statement 2yr Horizontal AnalysisTotal Company 2008 2007 V$ V%$M GM Ford GM Ford GM Ford GM Ford $ $ $ $Net Sales 148 979 146 277 179 984 172 455 -31 005 -26 178 -17% -15%Cost of good sold -149 311 -127 103 -165 573 -142 587 16 262 15 484 -10% -11%Gross Profit -332 19 174 -14 411 29 868 14 079 -10 694 -98% -36%Selling general and administrative expenses -14 253 -21 430 -14 412 -21 169 159 -261 -1% 1%Other income (expense) net -6 699 -2629 -4 308 -3 068 -2 391 439 56% -14%Operating Income (loss) -21 284 -4 885 -4 309 5 631 -16 975 -10 516 394% -187%Interest expenses -2 345 -9 682 -3 388 -10 927 1 043 1 245 -31% -11%Interest income - GMAC - 424 0 1 316 389 -892 -389 -68% -100%Earnings from continuing operations -23 205 -14 567 -6 381 -4 907 -16 824 -9 660 264% 197%Income Tax -1 766 -63 -37 162 1 294 35 396 -1 357 -95% -105%Net Income (Loss) from affiliated companies -6 183 163 0 1 161 -6 183 -998 0% -86%Equity income net of tax 186 -214 524 -312 -338 98 -65% -31%Minority interests, net of tax 108 0 -406 0 514 0 -127% 0%Income from continued operations 0 9 4 565 41 -4 565 -32 -100% -78%Net earnings -30 860 -14 672 -38 732 -2 723 7 872 -11 949 -20% 439%
  • 20. Income Statement 2yr horizontal AnalysisAutomotive 2008 2007$M GM Ford GM Ford $ % $ % $ % $ %Net Sales 147 732 100 129 166 100 177 594 100 154 379 100Cost of good sold -149 723 -101 -127 103 -98 -164 946 -93 -142 587 -92Gross Profit -1 991 -1 2 063 2 12 648 7 11 792 8Selling general and administrative expenses -13 147 -9 -11 356 -9 -13 590 -8 -13 660 -9Other income (expense) net -610 0 0 0 0 0 -2 400 -2Operating Income -15 748 -11 -9 293 -7 -942 -1 -4 268 -3Interest expenses -884 -1 -1 938 -2 -1 042 -1 -2 252 -1Interest income - GMAC - 0 0 -755 -1 0 0 1 161 1Income from affiliated company 0 0 163 0 0 0 389 0Earnings from continuing operations -16 632 -11 -11 823 -9 -1 984 -1 -4 970 -3Income Tax 0 0 0 0 0 0 0 0Equity income net of tax 184 0 0 0 522 0 0 0Minority interests, net of tax 103 0 0 0 -406 0 0 0Loss before income tax – automotive -16 345 -11 -11 823 -9 -1 868 -1 -4 970 -3
  • 21. Income Statement 2yr vertical analysisTotal Company 2008 2007$M GM Ford GM Ford $ % $ % $ % $ %Net Sales 148 979 100 146 277 100 179 984 100 172 455 100Cost of good sold -149 311 -100 -127 103 -87 -165 573 -92 -142 587 -83Gross Profit -332 0 19 174 13 -14 411 -8 29 868 17Selling general and administrativeexpenses -14 253 -10 -21 430 -15 -14 412 -8 -21 169 -12Other income (expense) net -6 699 -4 -2629 -2 -4 308 -2 -3 068 -2Operating Income (loss) -21 284 -14 -4 885 -3 -4 309 -2 5 631 3Interest expenses -2 345 -2 -9 682 -7 -3 388 -2 -10 927 -6Interest income - GMAC - 424 0 0 0 1 316 1 389 0Earnings from continuing operations -23 205 -16 -14 567 -10 -6 381 -4 -4 907 -3Income Tax -1 766 -1 -63 0 -37 162 -21 1 294 1Net Income (Loss) from affiliatedcompanies -6 183 -4 163 0 0 0 1 161 1Equity income net of tax 186 0 -214 0 524 0 -312 0Minority interests, net of tax 108 0 0 0 -406 0 0 0Income from continued operations 0 0 9 0 4 565 3 41 0Net earnings -30 860 -21 -14 672 -10 -38 732 -22 -2 723 -2
  • 22. Income Statement 2 yr vertical analysisAutomotive 2008 2007$M GM Ford GM Ford $ % $ % $ % $ %Net Sales 147 732 100 129 166 100 177 594 100 154 379 100Cost of good sold -149 723 -101 -127 103 -98 -164 946 -93 -142 587 -92Gross Profit -1 991 -1 2 063 2 12 648 7 11 792 8Selling general and administrativeexpenses -13 147 -9 -11 356 -9 -13 590 -8 -13 660 -9Other income (expense) net -610 0 0 0 0 -2 400 -2Operating Income -15 748 -11 -9 293 -7 -942 -1 -4 268 -3Interest expenses -884 -1 -1 938 -2 -1 042 -1 -2 252 -1Interest income - GMAC - 0 0 -755 -1 0 0 1 161 1Income from affiliated company 0 0 163 0 0 0 389 0Earnings from continuing operations -16 632 -11 -11 823 -9 -1 984 -1 -4 970 -3Income Tax 0 0 0 0 0 0 0 0Equity income net of tax 184 0 0 0 522 0 0 0Minority interests, net of tax 103 0 0 0 -406 0 0 0Loss before income tax – automotive -16 345 -11 -11 823 -9 -1 868 -1 -4 970 -3
  • 23. Mix Analysis – General Motors Mix Analysis GM Operating Percentage to Change in Operating Percentage of Sales Change in Sales Total Sales Percentage sales Mix Analysis GM 2008 2007 2008 2007 Percentage of % Operating $ % $ $ Sales Percentage to Sales Change in Sales 2008 2007 2008 2007 % $Other Financing 1% 1%Other Financing 1% -27% -562% 1% -48% -562% -1143 -48%-535%-1143 -5218 -27% -6361 GM Auto GMNA 58% 62% -16% -3% -23% -26261 GM Auto GME 23% 21% -8% -1% -8% -3090 GMLAAM 14% 10% 6% 7% 7% 1366 GAAP 12% 11% -7% 3% -12% -2489 GMNA 58% 62% -16% -3% -23% -26261 -13% 15648 -10613 Corporate -7% -6% 52% 32% -5% 612 Total 100% 100% -20% -3% -17% -31005 GME 23% 21% -8% -1% -8% -3090 -7% 755 -2335 GMLAAM 14% 10% 6% 7% 7% 1366 -1% -1409 -43 GAAP 12% 11% -7% 3% -12% -2489 -9% 739 -1750 Corporate -7% -6% 52% 32% -5% 612 20% -2645 -2033 Total 100% 100% -20% -3% -17% -31005 -16% 7870 -23135
  • 24. Mix Analysis – Ford Consolidated Change in ($M) Percentage of Operating Percentage Change in Operating Percentage Sales & Revenues to Sales & Revenues Sales & Revenues Sales & Revenue Total 2008 2007 2008 2007 % $ % $ $Bank 11% 10% -2% 1% -6% -8 -2% -3590 -3 774Non-bank 36% 41% -7% -2% -24% 408 -5% -6737Ford NA -6 109Ford SA 6% 4% 1% 1% 14% 7 0% 236 58Ford Europe 27% 21% 1% 0% 7% 12 0% 339 226Volvo 10% 10% -1% -2% -17% 49 0% 615 1 028Ford APA 4% 4% 0% 0% -8% 0 0% -292 -292Mazda 0% 0% 0% 0% 0% 0 0% -259 -287Other 0% 0% -1% -1% 44% -1 -1% -853 -694Jaguar LR&AM 5% 9% 0% 0% -54% -41 0% -686 -814 -10 658Total 100% 100% -10% -2% -15% 569 -8% -7637
  • 25. 60% 50 120% 101 50% 101%50% 100% 1st Quarter40% 31% 1st Quarter 80% 28% 26% 25% 2nd Quarter30% 21% 2nd Quarter 60%20% 3rd Quarter 40% 24% 26% 24% 26% 3rd Quarter 11% 8%10% 4th Quarter 20% 0% 2% 2% 4th Quarter 0% 0% Net Sales and Net Income Net Sales and Net Income Revenue Revenue 46 804 46,519 46,80450,000 50,000 43,094 43,567 42,383 37,808 38,01040,000 1st Quarter 40,000 30,778 1st Quarter 30 778 30,00030,000 2nd Quarter 20,000 2nd Quarter20,000 10,000 891 3rd Quarter 62 3rd Quarter10,000 0 4th Quarter -722 4th Quarter -10,000 Net Sales and Net Income 0 Revenue -3,251 -20,000 Net Sales and Net Income-10,000 Revenue -2,542 -9,596 -30,000-20,000 -15,471 -40,000 -38,963 -38 963
  • 26. 59 59%60% 120% 103 103%50% 41% 100%40% 1st Quarter 80% 1st Quarter 30% 28%30% 22% 20% 2nd Quarter 60% 2nd Quarter20% 3rd Quarter 40% 25%26%24%26% 28% 3rd Quarter 4th Quarter 10% 14% 4th Quarter10% 1% 1% 20% 0% 0% Net Sales and Net Income Net Sales and Net Income Revenue Revenue 44 44242 44116 43019 11650,000 45000 41078 43,528 41512 41,512 4000040,000 35000 32,045 29,192 30000 1st Quarter 1st Quarter30,000 29 192 25000 2nd Quarter 2nd Quarter 2000020,000 3rd Quarter 3rd Quarter 1500010,000 4th Quarter 10000 4th Quarter 100 5000 750 0 0 -129 -5000 Net Sales and -282 Income Net -380 -2811 Net Sales and Net Income-10,000 Revenue -5,976 Revenue -8,667
  • 27. Global Balance Sheet - Assets GM Ford December 31, 2008 2007 2008 2007 (Dollars in millions) Current assets 45 731 77 124 175 379 214 658 Assets Non-current assets 45 316 71 759 43 700 64 769 Total assets 91 047 148 883 219 079 279 427 $91b $219b Current liabilities 75 733 75 323 68 926 76 047 Liabilities Non-current liabilities 100 654 109 040 165 518 196 168 Total Liabilities $176b 176 387 184 363 $234b 234 444 272 215 Minority interests 814 1 614 1 195 1 421 Owner Equity -86 154 -37 094 -17 311 5 628Total Liabilities&Owners Equity 91 047 148 883 218 328 279 264
  • 28. Global Balance Sheet - Assets HORIZONTAL GM Ford VERTICAL V% HORIZONTAL V$ V%December 31, 2008 2007 2008 2007 2008 2007 GM Ford GM Ford(Dollars in millions) GM Ford GM Ford Current AssetsCash and cash equivalents 14 053 24 817 22 049 35 283 15% 10% 17% 13% -10 764 -13 234 -43% -38%Loaned securities 0 0 0 10 267 0% 0% 0% 4% 0 -10 267 0% -100%Marketable securities 141 2 354 $12b 5 248 17 903 0% 8% 2% 2% -2 213 12 655 -94% 241%Total cash and marketablesecurities $14b 14 194 27 171 $40b 39 952 50 798 16% 18% 18% 18% -12 977 -10 846 -137% 104%Finance Receivables $8b 7 711 9 659 99 657 117 916 $100b10 121 8% 45% 6% 42% -1 948 -18 259 -20% -15%Inventories 13 042 14 939 8 618 14% 4% 10% 4% -1 897 -1 503 -13% -15% $13b $23bEquipment on operating leases, net 5 584 11 995 23 120 30 309 6% 11% 8% 11% -6 411 -7 189 -53% -24%Equity in net assets of affiliatedcompanies $0.5b 491 7 079 0 0 1% 0% 5% 0% -6 588 0 -93% 0%Other current assets and deferred 4 709 6 281 4 032 5 514 5% 2% 4% 2% -1 572 -1 482 -25% -27%income taxesTotal current assets 45 731 77 124 175 379 214 658 50% 80% 52% 77% -31 393 -39 279 -342% 23% Non-Current AssetsEquity in net assets of 1 655 1 919 1 592 2 853 2% 1% 1% 1% -264 -1 261 -14% -44%nonconsolidated affiliatesProperty, net 39 656 43 017 28 352 35 979 44% 13% 29% 13% -3 361 -7 627 -8% -21%Goodwill and intangible assets, net 265 1 066 1 593 2 069 0% 1% 1% 1% -801 -476 -75% -23%Deferred income taxes 98 2 116 3 108 3 500 0% 1% 1% 1% -2 018 -392 -95% -11%Prepaid pension 109 20 175 0 0 0% 0% 14% 0% -20 066 0 -99% 0%Assets of discontinued/held for sale 0 0 198 7 537 0% 0% 0% 3% 0 -7 339 0% -97%operationsOther assets 3 533 3 466 8 857 12 831 4% 4% 2% 5% 67 -3 974 2% -31%Total non-current assets 45 316 71 759 43 700 64 769 50% 20% 48% 23% -26 443 -21 069 -37% -33%Total assets 91 047 148 883 219 079 279 427 100% 100% 100% 100% -57 836 -60 348 -4 0
  • 29. Current = CR = CA / CLLiquidity Quick = Q = CA-Inv / CL 3.5 3 GM’s Cr < .7, 2.5 2 GM is illiquid since 2006. 1.5 So ,there is risk of CR = 0.56 CR = 0.56 Q = 0.38 1 0.5 bankruptcy Q = 0.38 0 latest 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Qtr Current Ratio 0.64 0.58 0.66 2.9 3.45 3.27 3.21 0.95 0.86 0.56 0.56 Industry Quick Ratio 0.3 0.27 0.39 1.48 2.29 2.2 1.92 0.47 0.52 0.29 0.29 CR = 0,83 Q= 1,05 3.5 3 Ford’s Cr > 2.00, 2.5 Ford is in excess of liquidity since 2007; it can either invest in Fixed CR = 1.23 2 Assets, R&D, Buy back shares, pay Q = 1.17 1.5 dividends, retire bonds, buy a 0.5 1 Co., put money into bond sinking ERROR!!! fund, develop the banking 0 activities, or advertise more latest 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Qtr Current Ratio 1.02 0.81 0.76 1.01 1.1 1.06 1.18 0.75 2.32 2.22 2.22 Quick Ratio 0.7 0.5 0.45 0.7 0.65 0.74 0.83 0.55 2.06 1.78 1.78
  • 30. 260 210 160 110 60 10 -40 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008Days Sales Outstanding 11.1 10.8 11.6 20.6 35.7 39.4 34.9 20.9 8.3 9.5Days Inventory 32.9 27 26.6 23.8 25.1 26.5 28.4 31.3 31.7 33.9Payables Period 59.7 59.2 65.9 63.9 63.5 61.9 62.7 64.3 63.2 62.7Cash Conversion Cycle -15.8 -21.3 -27.7 -19.4 -2.7 4 0.6 -12.1 -23.3 -19.3 260 DSO= A/R x 360 / Sales 210 ICD= Inv x 360 / CGS 160 APD= A/P x 360 / CGS 110 CCC= DSO + ICD - APD 60 10 Error?! -40 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008Days Sales Outstanding 9.7 13.3 9.5 4.8 5.3 9.2 14.9 18.6 124 123.6 260 260.3Days Inventory 18.5 20.2 19.4 19.2 22.7 26.8 26.5 26.7 27.8 26.9Payables Period 42.7 42.7 43.5 44.2 42 49.4 55.8 56.7 56.8 51.1Cash Conversion Cycle -14.4 -9.3 -14.6 -20.2 -14 -13.4 -14.4 -11.4 95 94.6 236 236.1
  • 31. GM F 2008 2007 2008 2007LiquidityCURRENT CA/CL 55,8 86,5 1.22 1.03QUICK (CA-INV)/CL 38,1 65,0 1.16 0.97ProfitabilityROA NI/TA -34% -26% -7% -1%ROE (NI-PS Div)/CE 36% 104% 85% -48%ROS NI/SALES -21% -22% -10% -2%CashManagementDSO REC/(SALES7360) 19 19 15 17ICD INV/(CGS/360) 31 32 24 26APD PAY/(CGS/360) 54 64 42 53CCC DSO+ICD-APD -4 -12 -2 -10Market ValueDPS DIV/WSO $0 $1 $0 $0EPS (NI-PSD)/WSO -$53,30 -$68,43 -$6,45 -$1,38DIV PAYOUT DPS/EPS 0% -1% 0% 0%WSO 579 566 2273 1979MKT CAP O/S*Mkt price $1 953 546 339 $1 811 389 597 $0 $0TurnoverASSET TURN SALES/TA 1,6 1,2 0,7 0,6INV TURN CGS/INV 11,4 11,1 14,7 14,1REC TURN SALES/REC 19,3 18,6 24,1 21,0LeverageDEBT/ASSETS TL/TA 194% 124% 107% 97%DEBT/EQUITY TL/TOE -204,7% -497,0% -1354,3% 4836,8%TIE Op. Inc./Int.Exp. -9,1 -1,4 16,3 15,3ProductivitySALES/EMPLOYEE $613 082 $676 632 $686 746 $701 037NI/EMPLOYEE -$126 996 -$145 609 -$68 883 -$11 069
  • 32. Bond AnalysisBond Ratings: Risks and Returns on Different Classes of•The higher the Securitiesrisk, the higherthe returndemanded• Nationally CCC bondsRecognized BB bondsStatistical Rating Rate of Return A bondsOrganizations AAA bonds • Moody’s Short Term • S&P US Treasury Bills Risk of Investors
  • 33. Bond Analysis - Ford Even THEY would not buy themselves - Negative trend - Speculative Bonds to Substandard Ones - (Horrible to Very Bad…) Consequence:- Difficulty to generate capital to the Company- => Bankruptcy
  • 34. Bond Analysis - GM GM GMAC ResCapNRSRO Senior Corporate Secured Unsecured Outlook Senior Debt Outlook Senior Debt OutlookDBRS Watch - Watch- CC CCC (low) CC Negative RD Positive D PositiveFitch C CCC C Negative C Developing C StableMood y’s Ca B3 C Negative CCC Negative CC Negative S&P Review- Review - CC CCC C Negative CCC Negative C Negative
  • 35. Global Balance Sheet - Liabilities HORIZONTAL GM Ford VERTICAL V% HORIZONTAL V$ V%December 31, 2008 2007 2008 2007 2008 2007 GM Ford GM Ford(Dollars in millions) GM Ford GM Ford Current LiabilitiesAccounts payable (principally trade) 22 259 29 469 14 772 20 832 24% 7% 20% 7% -7 210 -6 060 -24% -29%Short-term borrowings and currentportion of long-term debt 16 946 10 955 21 759 27 543 19% 10% 7% 10% 5 991 -5 784 55% -21%Accrued expenses 35 921 34 024 32 395 27 672 39% 15% 23% 10% 1 897 4 723 6% 17%Other liabilities and deferred incometaxes 607 875 0 0 1% 0% 1% 0% -268 0 -31% 0%Total current liabilities 75 733 75 323 68 926 76 047 83% 32% 51% 27% 410 -7 121 1% -9% Non-Current LiabilitiesLong-term debt 29 594 33 384 132 437 141 244 33% 61% 22% 51% -3 790 -8 807 -11% -6%Postretirement benefits other thanpensions 28 919 47 375 5 358 23 760 32% 2% 32% 9% -$18b -18 456 -18 402 -39% -77% 25 178 11 381 11 435 6 678 28% 5% 8% 2% 13 797 4 757 121% 71%PensionsOther liabilities and deferred income $14btaxes 16 963 16 900 16 233 19 662 19% 7% 11% 7% 63 -3 429 0% -17%Liabilities of discontinued/held-for-saleoperations 0 0 55 4 824 0% 0% 0% 2% 0 -4 769 0% -99%Total non-current liabilities 100 654 109 040 165 518 196 168 111% 76% 73% 70% -$8b-4%-$31b -16% -8 386 -30 650 -8% -16%Total Liabilities 176 387 184 363 234 444 272 215 194% 107% 124% 97% -7 976 -37 771 -4% -14%Minority interests 814 1 614 1 195 1 421 1% 1% 1% 1% -800 -226 -50% -16% Stockholders’ Deficit / EquityCommon Stock 1 017 943 24 22 1% 0% 1% 0% 74 2 8% 9%Capital surplus (principally additionalpaid-in capital) 15 755 15 319 9 076 7 834 17% 4% 10% 3% 436 1 242 3% 16%Retained earnings (deficit) -70 610 -39 392 -16 145 -1 485 -78% -7% -26% -1% -31 218 -14 660 79% 987%Accumulated other comprehensiveincome/loss -32 316 -13 964 -10 085 -558 -35% -5% -9% 0% -18 352 -9 527 131% 1707%Treasury Stock 0 0 -181 -185 0% 0% 0% 0% 0 4 0% -2%Owner Equity -86 154 -37 094 -17 311 5 628 -95% -8% -25% 2% -49 060 -22 939 132% -408%Total Liabilities&Owners Equity 91 047 148 883 218 328 279264 100% 100% 100% 100% -57 836 -60 936 78% -437%
  • 36. Global Balance Sheet - Assets HORIZONTAL GM Ford VERTICAL V% HORIZONTAL V$ V%December 31, 2008 2007 2008 2007 2008 2007 GM Ford GM Ford(Dollars in millions) GM Ford GM Ford Current AssetsCash and cash equivalents 14 053 24 817 22 049 35 283 15% 10% 17% 13% -10 764 -13 234 -43% -38%Loaned securities 0 0 0 10 267 0% 0% 0% 4% 0 -10 267 0% -100%Marketable securities 141 2 354 17 903 5 248 0% 8% 2% 2% -2 213 12 655 -94% 241%Total cash and marketablesecurities 14 194 27 171 39 952 50 798 16% 18% 18% 18% -12 977 -10 846 -137% 104%Finance Receivables 7 711 9 659 99 657 117 916 8% 45% 6% 42% -1 948 -18 259 -20% -15%Inventories 13 042 14 939 8 618 10 121 14% 4% 10% 4% -1 897 -1 503 -13% -15%Equipment on operating leases, net 5 584 11 995 23 120 30 309 6% 11% 8% 11% -6 411 -7 189 -53% -24%Equity in net assets of affiliated 491 7 079 0 0 1% 0% 5% 0% -6 588 0 -93% 0%companiesOther current assets and deferred 4 709 6 281 4 032 5 514 5% 2% 4% 2% -1 572 -1 482 -25% -27%income taxesTotal current assets 45 731 77 124 175 379 214 658 50% 80% 52% 77% -31 393 -39 279 -342% 23% Non-Current AssetsEquity in net assets of 1 655 1 919 1 592 2 853 2% 1% 1% 1% -264 -1 261 -14% -44%nonconsolidated affiliatesProperty, net 39 656 43 017 28 352 35 979 44% 13% 29% 13% -$3b -3 361 -$8b -8% -7 627 -21%Goodwill and intangible assets, net 265 1 066 1 593 2 069 0% 1% 1% 1% -801 -476 -75% -23%Deferred income taxes 98 2 116 3 108 3 500 0% 1% 1% 1% -2 018 -392 -95% -11%Prepaid pension 109 20 175 0 0 0% 0% 14% -$20b 0% -20 066 0 0-99% 0%Assets of discontinued/held for sale 0 0 198 7 537 0% 0% 0% 3% 0 -7 339 0% -97%operationsOther assets 3 533 3 466 8 857 12 831 4% 4% 2% 5% 67 -3 974 2% -31%Total non-current assets 45 316 71 759 43 700 64 769 50% 20% 48% 23% -26 443 -21 069 -37% -33%Total assets 91 047 148 883 219 079 279 427 100% 100% 100% 100% -57 836 -60 348 -4 0
  • 37. Structure of the Global Balance Sheet 2008 2008 23% 2007 60 40 20 2007 Debt to Assets 0 2008 Debt to Assets latest 194% 2008 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 50% Qtr 107% 20% 48% Financial Leverage 13.31 10.04 16.44 54.41 17.75 17.3 32.61 0 0 0 0 52% Debt to Equity Debt/Equity 6.28 4.72 8.32 29.64 10.75 10.83 19.58 0 0 0 80% 0 Debt to Equity -204,7% 50% -1354,3% 60 40 77% Interest 20 0 Interest Coverage 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 latest Qtr Coverage -9,1 Financial Leverage 10.03 15.28 35.52 52.81 27.12 18.24 20.8 0 49.62 0 0 16,3 Current assets Non-current assets Current assets Non-current assets Debt/Equity 5.61 9.11 22.05 29.97 15.55 10.78 11.91 0 29.94 0 0 1% 2% -18% 1% 27%Current liabilities 29% 34% 1% -7% 27% -33% Current liabilitiesNon-current liabilities Non-current liabilitiesMinority interests Minority interestsOwner Equity 0% Owner Equity 38% 65% 49% 2008 70% 2008 2007 2007
  • 38. 2005: Sales of Electro-Motive Division (EMD) for $201M 2006: Sale of 51% of GMAC for $7.4b 2005: Delphi restructuring activities 2006: $3.5b Net loss from continuing operations 2006: 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008Cash from Financing 8610 14120 22372 26667 58922 21475 3480 -3 -3767 -5 593 767 -5593 3843Cash from Investing -34994 -33773 -23171 -41377 -55492 -31768 8 565 8565 19 695 -1760 19695 -1764Cash from Operations 27030 19750 9166 17109 7600 13061 -16856 -11759 7731 -12065 -16 856 -11 759 Ford sold Hertz in 2005 for $200M 2006: $.50 Dividend per share 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008Cash from Financing 12213 3771 -2976 -10333 -5132 -9865 -20651 15 273 15273 -5242 -9104Cash from Investing -40282 -36151 -17169 -3620 -6325 -14851 7 7457 457 -24864 -6483 -3143Cash from Operations 29811 33764 22764 18633 20195 24514 21674 9609 17074 -179 -179
  • 39. ROS= NI / Sales ROA = NI / TA Profitability ROE= NI / TOE 35.00% 25.00% 15.00% 5.00% -5.00% -15.00% -25.00% -35.00% -45.00% -55.00% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008Return on Assets 2.23% 1.50% 0.16% 0.49% 0.93% 0.60% -2.21% -0.60% -23.12% -25.72%Return on Equity 33.24% 17.09% 2.01% 12.74% 23.83% 10.59% -49.94% -43.21% 0 0 35.00% 25.00% 15.00% 5.00% -5.00% -15.00% -25.00% -35.00% -45.00% -55.00% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008Return on Assets 2.81% 1.23% -1.95% -0.35% 0.16% 1.15% 0.72% -4.60% -0.98% -5.90%Return on Equity 28.35% 14.96% -41.43% -14.88% 5.74% 25.18% 13.96% 0 0 0
  • 40. 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% -5.00% -10.00% -15.00% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 TTMOperating Margin 9.50% 9.10% 5.70% 5.20% 6.70% 6.80% -0.60% -3.70% -2.40% -14.30% -14.30%EBT Margin 5.10% 3.90% 0.90% 1.10% 1.60% 0.60% -8.80% -2.40% -3.50% -19.70% -19.70%Gross Margin 28.20% 21.10% 18.80% 17.90% 18.00% 17.30% 11.20% 20.60% 8.20% -1.10% -1.10% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% -5.00% -10.00% -15.00% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 TTMOperating Margin 11.40% 10.40% 2.10% 6.00% 4.90% 6.20% 4.00% -5.10% 3.30% -9.40% -9.40%EBT Margin 6.80% 4.80% -4.70% 0.60% 0.80% 2.80% 1.10% -9.40% -2.20% -9.80% -9.80%Gross Margin 26.80% 25.80% 20.50% 23.40% 20.90% 20.90% 18.20% 6.90% 17.30% 13.10% 13.10%
  • 41. 40000 30000 20000 10000 0 -10000 -20000 -30000 -40000 -50000 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008Cash from Operations 27030 19750 9166 17109 7600 13061 -16856 -11759 7731 -12065Cap Ex -30549 -31605 -26671 -24067 -19091 -22077 -23675 -7933 0 -7530Free Cash Flow -3519 -11855 -17505 -6958 -11491 -9016 -4 -40531 531 -19692 00 -19595 40000 35000 30000 25000 20000 15000 10000 5000 0 -5000 -10000 -15000 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008Cash from Operations 29811 33764 22764 18633 20195 24514 21674 9609 17074 -179Cap Ex -8535 -8348 -7008 -7278 -7749 -6745 -7517 -6848 -6022 -6696Free Cash Flow 21276 2525416 416 15756 11355 12446 17769 14157 2761 11052 -6 875 -6875
  • 42. Capital Expenditures Analysis - Ford Capital Expenditures Analysis Pb Assets/ ($M) Assets % P&E additions % P&E addition 2008 P&E addition 2007 Segments 2008 2007 2008 2007 % of Assets % to Dep % of Assets % to Dep Bank (Ford Credit) 67% 57% 1% 0% 0% 0% 0% 0% Other Financing Services 5% 4% 0% 1% 0% 86% 0% 153% Elims -4% 0% 0% 0% 0% 0% 0% 0% Non-bank (Automotive) 33% 40% 99% 99% 3% 60% 2% 88% Other -1% -1% 0% 0% 0% 0% 0% 0% Total 100% 100% 100% 100% 3% 0% 2% 46% Capital Expenditures Ford Automotive Pb Assets/ ($M) P&E additions % P&E addition 2008 P&E addition 2007 Segments 2008 2007 % of Assets % to Dep % of Assets % to Dep Ford NA 2% 1% 2% 45% 1% 76% Ford SA 0% 0% 0% 112% 0% 156% Ford Europe 1% 0% 1% 101% 0% 96% Volvo 0% 0% 0% 74% 0% 98% Ford APA 0% 0% 0% 126% 0% 99% Mazda 0% 0% 0% 0% 0% 0% Jaguar LR&AM 0% 0% 0% 0% 0% 135% Total Automotive 3% 2% 3% 58% 2% 88%
  • 43. Capital Expenditures Analysis - GM Capital Expenditures GM Assets % P&E additions % P&E addition 2008 P&E addition 2007Segments 2008 2007 2008 2007 % of Assets % to Dep % of Assets % to DepBank (GMAC) 6% 8% 0% 0% 0%Other Financing -1% 3% 0% 0% 0% Segments 2008 2007 2008 2007 % of Assets Dep % to Dep % of Assets Dep % to Dep Bank (GMAC) 5072 6% 12110 8% 0 0% 0 0% 0% 8100 0% 0% 0 0%Non-bank Other Financing -565 -1% 4879 3% 0 0% 4 0% 0% 157 0% 0% 0 0% Non-bank 0% GMNA 68037 75% 95433 64% 4064 54% 4988 66% 6% -989 -411% 5% 1594 313%GMNA GME 19265 21% 75%25201 17% 64%1563 21% 54% 1311 17% 66% 8% 1175 6% 133% -411% 5% 90 5%1457% 313% GMLAAM 7039 8% 7733 5% 370 5% 220 3% 5% 35 1057% 3% 5 4400% GAAPGME 10940 12% 21%15567 10%17% 818 11% 21%899 12% 17% 7% 67 8% 1221% 133% 6% 14 5%6421% 1457% GMA Eliminations -12117 -13% -11313 -8% 178 2% 41 1% -1% 0 0% 0% 0 0% Corporate -6624 -7% -727 0% 537 7% 79 1% -8% 765 70% -11% 38021 0% TotalGMLAAM 91047 100% 8% 148883 100% 5%7530 100% 5% 7542 100% 3% 8% 9310 5% 124% 1057% 5% 39724 3% 19% 4400%GAAP 12% 10% 11% 12% 7% 1221% 6% 6421%GMA Eliminations -13% -8% 2% 1% -1% 0% 0% 0%Corporate -7% 0% 7% 1% -8% 70% -11% 0%Total 100% 100% 100% 100% 8% 124% 5% 19%
  • 44. Banking GM  General Motors Acceptance Corporation  ResCap Ford  Ford Credit
  • 45. GMAC vs. GM Comparative Income Comparative Income & &Sales 2008 Sales 2007 $200,000 200,000 $150,000 $100,000 100,000 $50,000 0 $0 GMAC GMA Total -$50,000 GMAC GMA Total -100,000 EBT Financing Revenue EBT Financing Revenue Comparative Total Comparative Total Assets 2 Liabilities 2 years years $300,000 $300,000 $200,000 $200,000 $100,000 $100,000 $0 $0 GMAC GMA Total GMAC GMA Total TL 2008 TL 2007 2008 2007
  • 46. Ford Credit vs. Segments Comparative Income & Comparative Income & Sales 2008 Sales 2007$200,000 200000$150,000 150000$100,000 100000 $50,000 50000 $0 0-$50,000 -50000 Ford Credit Ford Total Ford Credit Ford Total Automotive Automotive EBT SALES EBT SALES Comparative Total Assets 2 Comparative Total Liabilities years 2 years$300,000 $300,000$200,000 $200,000$100,000 $100,000 $0 Ford Credit Ford Ford Total Assets $0 Automotive FC FA FT 2008 2007 2008 2007
  • 47. RevenueConsumer 6 737 37% 9 469 45%Commercial 2 368 13% 2 947 14%Loans held-for-sale 1 092 6% 1 557 7%Operating leases 8 198 45% 7 214 34%Total Financing Revenue 18 395 100% 21 187 100%Interest expense 11 870 65% 14 776 70%Depreciation expense on operating lease assets 5 483 30% 4 915 23%Impairment of investment in operating leases 1 234 7% 0 0%Net financing revenue/(loss) 192 -1% 1 496 7% Other RevenueServicing fees 1 782 10% 2 193 10%Amortization and impairment of servicing rights 0 0% 0 0%Servicing asset valuation and hedge activities, 284 -2% 544 -3%netInsurance premiums and service revenue earned 4 329 24% 4 378 21%Gain/(loss) on mortgage and automotive loans, 1 560 -8% 508 2%netGain on extinguishment of debt 12 628 69% 563 3%Investment (loss) income 446 -2% 473 2%Gains on sale of equity-method investments, net 0 0% 0 0%Other income, net of losses 601 3% 2 732 13%Total other revenue 17 050 93% 10 303 49%Total Net Revenue 16 858 92% 11 799 56%Provision for credit losses 3 683 20% 3 096 15% Noninterest expensesCompensation and benefits expense 2 229 12% 2 453 12%Insurance losses and loss adjustment expenses 2 522 14% 2 451 12%Other operating expenses 6 505 35% 5 286 25%Impairment of goodwill and other intangible 58 0% 455 2%assetsTotal noninterest expense 11 314 62% 10 645 50%EBT 1 861 10% 1 942 -9%Income tax expense/(benefit) 7 0% 390 2%Net income/(loss) 1 868 10% 2 332 -11%
  • 48. RevenueConsumer 6 737 9 469 45% -29%Commercial 2 368 2 947 14% -20%Loans held-for-sale 1 092 1 557 7% -30%Operating leases 8 198 7 214 34% 14%Total Financing Revenue 18 395 21 187 100% -13%Interest expense 11 870 14 776 70% -20%Depreciation expense on operating lease assets 5 483 4 915 23% 12%Impairment of investment in operating leases 1 234 0 0% N/ANet financing revenue/(loss) 192 1 496 7% -113% Other RevenueServicing fees 1 782 2 193 10% -19%Amortization and impairment of servicing rights 0 0 0% 0%Servicing asset valuation and hedge activities, net 284 544 -3% -48%Insurance premiums and service revenue earned 4 329 4 378 21% -1%Gain/(loss) on mortgage and automotive loans, net 1 560 508 2% -407%Gain on extinguishment of debt 12 628 563 3% 2143%Investment (loss) income 446 473 2% -194%Gains on sale of equity-method investments, net 0 0 0% 0%Other income, net of losses 601 2 732 13% -78%Total other revenue 17 050 10 303 49% 65%Total Net Revenue 16 858 11 799 56% 43%Provision for credit losses 3 683 3 096 15% 19% Noninterest expensesCompensation and benefits expense 2 229 2 453 12% -9%Insurance losses and loss adjustment expenses 2 522 2 451 12% 3%Other operating expenses 6 505 5 286 25% 23%Impairment of goodwill and other intangible assets 58 455 2% -87%Total noninterest expense 11 314 10 645 50% 6%EBT 1 861 1 942 -9% -196%Income tax expense/(benefit) 7 390 2% -102%Net income/(loss) 1 868 2 332 -11% -180%
  • 49. 200,000 200,000150,000 150,000100,000 100,000 50,000 50,000 0 GMAC GMA Total 0 GMAC GMA Total-50,000 EBT Financing Revenue -50,000 EBT Financing Revenue
  • 50. Financing RevenueOperating leases 6 519 40% 6 343 38%Retail 3 270 20% 3 475 21%Interest supplements and other support costs earned from 4 774 29% 4 592 27%affiliated companiesWholesale 1 721 10% 2 132 13%Other 133 1% 174 1%Total Financing Revenue 16 417 100% 16 716 100%Depreciation on vehicles subject to operating leases -9 019 -55% -6 188 -37%Interest expense -7 634 -47% -8 630 -52%Net Financing margin -236 -1% 1 898 11% Other revenueInvestment and other income related to sales of receivables 199 1% 391 2%Insurance premiums earned, net 140 1% 169 1%Other income, net 758 5% 1 362 8%Total financing margin and other revenue 861 5% 3 820 23% ExpensesOperating expenses 1 548 9% 1 929 12%Provision for credit losses 1 769 11% 588 4%Insurance expenses 103 1% 88 1%Total expenses 3 420 21% 2 605 16%EBT -2 559 -16% 1 215 7%Provision for / (Benefit form) income taxes -1 014 -6% 446 3%Income from continuing operations -1 545 -9% 769 5%Gain on disposal of discontinued operations 9 0% 6 0%Net income/(loss) -1 536 -9% 775 5%
  • 51. Financing RevenueOperating leases 6 519 6 343 176 3%Retail 3 270 3 475 205 -6%Interest supplements and other support costs earned from 4 774 4 592 182 4%affiliated companiesWholesale 1 721 2 132 411 -19%Other 133 174 41 -24%Total Financing Revenue 16 417 16 716 299 -2%Depreciation on vehicles subject to operating leases -9 019 -6 188 2 831 46%Interest expense -7 634 -8 630 996 -12%Net Financing margin -236 1 898 2 134 -112% Other revenueInvestment and other income related to sales of receivables 199 391 192 -49%Insurance premiums earned, net 140 169 29 -17%Other income, net 758 1 362 604 -44%Total financing margin and other revenue 861 3 820 2 959 -77% ExpensesOperating expenses 1 548 1 929 381 -20%Provision for credit losses 1 769 588 1 181 201%Insurance expenses 103 88 15 17%Total expenses 3 420 2 605 815 31%EBT -2 559 1 215 3 774 -311%Provision for / (Benefit form) income taxes -1 014 446 1 460 -327%Income from continuing operations -1 545 769 2 314 -301%Gain on disposal of discontinued operations 9 6 3 50%Net income/(loss) -1 536 775 2 311 -298%
  • 52. $200,000 200000$150,000 150000$100,000 100000 $50,000 50000 $0 0 EBT SALES-$50,000 EBT SALES -50000 Ford Credit Ford Automotive Total Ford Credit Ford Total Automotive
  • 53. Comparative Balance Sheet 2 years Liabilities & Owner’s Equity Assets($M) December 31, 2008 % 2007 % V V% ($M, as of December 31,) 2008 % 2007 % V V%Cash andcash equivalents 15 473 10% 14 137 8% 1 336 9% LiabilitiesMarketable Accounts Payablesecurities 8 606 6% 3 155 2% 5 451 173% Customer deposits,Finance dealer reserves and other 1 781 1% 1 837 1% 56 -3%receivables, net 93 331 62% 111 468 66% 18 137 -16% Affiliated companies 1 015 1% 2 308 1% 1 293 -56%Net investment in Total accounts payable 2 796 2% 4 145 2% 1 349 -33%operating leases 22 506 15% 29 663 18% 7 157 -24% Debt 126 458 84% 139 411 82% 12 953 -9%Retained interests Deferred income taxes 2 668 2% 5 380 3% 2 712 -50%in securitizedassets 92 0% 653 0% 561 -86% Derivated financial instruments 2 145 1% 1 376 1% 769 56%Notes and accounts Liabilities of held-for-sale operations 56 0% 0 0% 56 N/Areceivable Other liabilities and deferred income 5 438 4% 5 314 3% 124 2%from affiliated TL 139 561 93% 155 626 92% 16 065 -10%companies 1 047 1% 906 1% 141 16% Shareholders interestDerivative financialinstruments 3 791 3% 2 811 2% 980 35% Shareholders interest 5 149 3% 5 149 3% 0 0%Assets of held-for- Accumulated othersale comprehensive income 432 0% 1 733 1% 1 301 -75%operations 214 0% 0 0% 214 N/A Retained earnings 4 985 3% 6 515 4% 1 530 -23%Other assets 5 067 3% 6 230 4% 1 163 -19% Total Shareholders interest 10 566 7% 13 397 8% 2 831 -21%Total Assets 150 127 100% 169 023 100% 18 896 -11% Total liabilites and shareholders interest 150 127 100% 169 023 100% 18 896 -11%
  • 54. Comparative Balance Sheet 2 years Assets 2 008 % 2 007 % V V%($M) December 31,Cash and cash equivalents 15 151 8% 17 677 7% 2 526 -14%Investment securities 8 445 4% 16 740 7% 8 295 -50%Loans held-for-sale 7 919 4% 20 559 8% 12 640 -61%Finance receivables and loans, net of unearned incomeConsumer 63 963 34% 87 769 35% 23 806 -27%Commercial 36 110 19% 39 745 16% 3 635 -9%Allowance forcredit losses 3 433 -2% 2 755 -1% 678 25%Total finance receivables loans 96 640 51% 124 759 50% 28 119 -23%Investment in operating leases 26 390 14% 32 348 13% 5 958 -18%Notes receivable from GM 1 655 1% 1 868 1% 213 -11%Mortgage servicing rights 2 848 2% 4 703 2% 1 855 -39%Premiums and other insurance receivables 2 995 2% 2 030 1% 965 48%Other assets 27 433 14% 28 255 11% 822 -3%Total Assets 189 476 100% 248 939 100% 59 463 -24%
  • 55. Comparative Cash Flow - GMACGMAC GMAC Cash Flow Cash FlowOperating Operating 2008 2007 2008 V 2007 V V% V%Net income Net income 1 868 -2 332 1 868 4 200 332 -2 4 200 -180% -180% Depreciation and amortization 6 239 5 937 302 5%Depreciation and amortization 6 239 5 937 302 5% Operating lease impairment 1 234 0 1 234 N/AOperating leasegoodwill and other intangible assets Impairment of impairment 1 234 58 0 1 234455 397 N/A -87% Amortization and valuation adjutments of mortage servicing rights 2 250 1 260 990 79%Decrease in for credit losses of goodwill and other intangible assets Provision Impairment 58 455 3 683 3973 096 587 -87% 19%Decrease in Amortization and valuation adjutments of mortage servicing rights Loss/(Gain) on sale of loans 2 250 1 260 1 825 990 -508 2 333 79% -459% Net losses (gains) on investment securities 1 203 737 466 63%Decrease in Provision fordebt Gain on extinguishment of credit losses 3 683 3 096 -12 628 587 -563 12 065 19% 2143%Loss/(Gain) on and purchases of loans held-for-sale Originations sale of loans 1 825 -508 -132 023 2 333 576 -128 3 447 -459% 3% Proceeds from sales and repayments of loans held-for-sale 141 312 121 620 19 692 16%Net losses change in Trading securities Net on investment securities 1 203 737 741 466 628 113 63% 18%Gain on extinguishment of debt Net change in Deferred income taxes -12 628 -563 -396 12 065 95 491 2143% -517% Net change in Interest payable -651 -332 319 96%Increase in loansother assets Net change in held-for-sale -132 023 -128 576 -1 213 3 447 -121 1 092 3% 902%Decreasechange in other liabilities Net in sales and repayments of loans held-for-sale 141 312 178 121 620 686 19 692 508 16% -74% Net change in other, net 415 -622 1 037 -167%DecreasecashTrading securities Net in provided by (used in) operating activites 741 14 628 095 1131 460 12 635 18% 865%Increase in Deferred income taxes -396 95 491 -517% InvestingIncrease in other assets Purchase of AFS securities -1 213 -121 -16 202 1 092 682 -16 480 902% -3%Increase in Interest payable Proceeds from sales of available-for-sale securities -651 -332 14 068 319 8 049 6 019 96% 75% Proceeds from maturities of AFS securities 7 502 8 080 578 -7%Increase in other liabilities Net increase/(decrease) in finance receivables and loans 178 686 5 570 508 972 -41 47 542 -74% -113%Increase in other, net finance receivables and loans Proceeds from sales of 415 1 -622 366 1 037 903 70 69 537 -167% -98% Purchases of operating lease assets -10 544 -17 268 6 724 -39%Net cash provided bylease assetsin) operating activites Disposals of operating (used 14 095 1 460 7 633 12 635 5 472 2 161 865% 39% Change in notes receivable from GM -62 138 200 -145%Net cash provided byservicing rights, net activities Sales/(Purchases) of mortgage investing 10918 18244 797 -7326 561 236 -40% 42%Financing Acquisitions of subsidiaries, net of cash acquired 0 -209 209 -100% Proceeds from sale of business units, net 319 15 304 2027%Dividends paid -113 -179 66 -37% Settlement of residual support and risk-sharing obligations with GM 0 0 0 0%Purchases of short-term debt Other,net -22 815 -9 248 471 13 567 1 157 686 147% -59% Net cash provided by investing activities 10 918 18 244 7 326 -40%Net increase in bank deposits 6 447 3 078 3 369 109%Proceeds from issuance of long-term debt Financing 44 724 70 230 25 506 -36% Net change in short-term debt -22 815 -9 248 13 567 147%Paymentsincrease/(decrease) in bank deposits Net of long-term debt -59 627 -82 134 6 447 22 507 3 078 3 369 -27% 109% Proceeds from issuance of long-term debt 44 724Issuances oif Senior preferred interests 5 000 0 5 000 230 70 25 506 N/A -36% Repayments of long-term debt -59 627 -82 134 22 507 -27%Iissuance of preferred interests Proceeds from issuance of senior preferred interests 0 0 5 000 0 0 5 000 0% N/A Proceeds from issuance of preferred interests 0 0 0 0%Increase/(Decrease) Other, net -1 784 675 2 459 -364% Dividends paid -113 -179 66 -37%Net cash used in financing activities Other, net -28 168 -17 578 -1 784 10 590 675 2 459 60% -364% Net cash used in financing activities -28 168 -17 578 10 590 60%Effect of exchange-rate changes and cash equivalents cash equivalents Effect of exchange-rate changes on cash on cash and 629 92 629 537 92 537 584% 584%Change in Cash Position cash and cash equivalents Net increase/(decrease) in -2 526 2 218 -2 526 4 744218 2 4 744 -214% -214%
  • 56. Comparative Cash Flow – Ford Credit 2008 2007V V% Operating Net income/(loss) -1536 775 -2311 -298% Provision for credit losses 1769 588 1181 201% Depreciation and amortization 9667 6778 2889 43% Amortization of upfront subvention -1278 0 -1278N/A Increaseon sales of finance receivables 0 -5 5 -100% Increase in deferred income taxes -2688 -1382 -1306 95% Decrease/(Increase) in other assets 2539 -288 2827 -982% Increase in other liabilities 124 286 -162 -57% Increase in other operating activities 531 21 510 2429% Net cash provided by operating activities 9128 6773 2355 35% Net cash provided by /(used in) investing activites 1852 -483 2335 -483% Financing Cash distributions/dividends paid 0 0 0 0% Increase of long-term debt 41720 34373 7347 21% Principal payments on long-term debt -45090 -39311 -5779 15% Increase/(Decrease) in Short Term Borrowings -5433 86 -5519 -6417% Other financing activities -352 -105 -247 235% Net cash provided by/(Used in) financing activities -9155 -4957 -4198 85% Effect of exchange rate changes on cash and cash equivalents -489 473 -962 -203% Change in cash and cash equivalents 1336 1806 -470 -26%
  • 57. Marketable Securities  Why? Companies  Substitute for transactions balances, for: don’t want  Compensating balances (to be able to pay interest payment) cash on their  Precautionary balances (kept for unforeseen fluctuations) balance  Speculative balances  Temporary investment sheet.  To finance seasonal or cyclical operations  To amass funds to meet financial requirements in But the near future  Characteristics: Today, the  Maturity more cash  Short Term (few days or weeks) you have the  Risk  Short Run is less uncertain winner you  So, less risk than for the Long Run Liquidity are.   Very liquid  Return (Yield)  Low
  • 58. Investing - GMAC Investing 2008 2007 V V% (Increase)of AFS securities -16202 -16682 480 -3% Proceeds from sales of available-for-sale securities 14068 8049 6019 75% Proceeds from maturities of AFS securities 7502 8080 -578 -7% Increase/(decrease) in finance receivables and loans 5570 -41972 47542 -113% Proceeds from sales of finance receivables and loans 1366 70903 -69537 -98% (Increase) in operating lease assets -10544 -17268 6724 -39% Decrease of operating lease assets 7633 5472 2161 39% Decrease/(Increase) in notes receivable from GM -62 138 -200 -145% Sales/(Purchases) of mortgage servicing rights, net 797 561 236 42% (Purchases) of subsidiaries, net of cash acquired 0 -209 209 -100% Proceeds from sale of business units, net 319 15 304 2027% (Purchases)/Sales in Other,net 471 1157 -686 -59% Net cash provided by investing activities 10918 18244 -7326 -40%
  • 59. Investing – Ford Credit Investing 2008 2007 V V% Purchases of finance receivables -32983 -39005 6022 -15% Collection of finance receivables 34594 37263 -2669 -7% Purchases of opearing lease vehicles -11230 -16517 5287 -32% Liquidations of operating lease vehicles 7413 7808 -395 -5% Decrease in wholesale receivables 3545 1986 1559 78% Decrease in retained interests in securitized assets 281 401 -120 -30% Net change in notes receivable from affiliated companies -184 148 -332 -224% Proceeds from sales of receivables and retained interests 0 697 -697 -100% Purchases of marketable securities -23831 -8795 -15036 171% Proceeds from sales and maturities of marketable securities 18427 15974 2453 15% Proceeds from sales of businesses 4413 167 4246 2543% Settlements of deritatives 1342 -188 1530 -814% All other investing activities 65 -422 487 -115% Net cash provided by /(used in) investing activites 1852 -483 2335 -483%
  • 60. Securitization
  • 61. Bond Analysis (Plus) GMAC ResCap Ford Credit Long- Short-Term OutlookSenior Senior Debt Outlook Debt Outlook Term Unsecured / Senior Trend Unsecure Watch - Watch- RD Positive D Positive d B R-5 Negativ C Developing C Stable e B- C Negativ CCC Negative CC Negative e Caa1 NP Negativ Review- Review - e CCC Negative C Negative CCC+ NR Negativ e
  • 62. General Motors Corporation Major Holders Ford Motors Company Major Holders Breakdown Breakdown % of Shares Held by All Insider and 5% Owners 55 57 % of Shares Held by All Insider 49 49 100 and 5% Owners 50 0 5 0 % of Shares Held by 0 % of Shares Held by Institutional & Mutual Fund Institutional & Mutual Fund Owners OwnersNumber of Institutions Holding Number of Institutions Holding 343 464Shares SharesNumber of Holders 493 Number of Holders 590Total Shares Held 295,833,180 Total Shares Held 1,263,916,332 Holder Shares Reported Holder Shares Reported Major Direct HoldersMajor Direct Holders Lutz Robert A. 81,390 March 20th, 2008 Ford William Clay Jr. 4,956,971 Sept. 18th, 2008 Szygenda Ralph J. 39,953 March 20th, 2008 Ford Edsel B. II 2,156,644 Dec. 31st, 2008 Wagoner G. Richard 35,290 March 20th, 2008 Parker John G. 205,361 March 11th, 2009 Jr. Fields Mark 146,651 March 11th, 2009 Cowger Gary L. 35,008 March 20th, 2008 Cheng Meiwei 141,685 March 11nd, 2009 Stephens Thomas G. 21,621 June 2nd, 2008
  • 63. Treasury Stock Ford Motors General Motors 6% 24% 10% Outstanding Stock 25% (Common and Class Common Stock B, Average) Treasury Stock Treasury Stock 75% 90% 76% 94% Treasury Stock GM Treasury Stock Ford 2008 2007 2008 2007 # (in M) $(in M) % # $ % # (in M) $(in M) % # $ % FORD Outstanding Stock (Common and Class B, Average) 2 273 24 94% 1979 24 90% Common Stock 610 483 231 1017 76% 566 059 249 943 75% Treasury Stock 139 181 6% 216 185 10% Treasury Stock 190 454 310 - 24% 190 578 292 - 25% Total 2412 205 100% 2195 209 100% Total 800 937 541 1017 100% 756 637 541 943 100% GM 2008 2007 2008 2007 # (in M) $(in M) % # $ % # (in M) $(in M) % # $ %OutstandingStock (Common Common Stock 611 1017 76% 566 059 249 943 75%and Class B,Average) 2 273 24 94% 1979 24 90% Treasury Stock 190 - 24% 190 578 292 - 25%Treasury Stock 139 181 6% 216 185 10% Total 801 1017 100% 756 637 541 943 100%Total 2412 205 100% 2195 209 100%
  • 64. Share Price Evolution GM 100% Ford 95% 100% S&P500 60% 93% 100% GM Ford S&P500
  • 65. Bubble Burst + 09/11 + Oil Shock + Internet Subprime Bubble Lending Crisis? Crisis 1st Oil Shock NTIC RapidSlow Slow Growth GrowthGrowth 2st Oil Shock
  • 66. Ratios - Reuters - GM F Industry GM vs Industry F vs IndustryValuation RatioBeta 1,84 1,75 0,89 W WPrice to sell 0,01 0,05 0,35DividendsDividend yield 0,00 0,00 0,02 W WDividend yield - 5 year average 5,49 2,70 1,62 B BDividend 5 year growth rate -24,21 - 30,92 WPayout ratio (TTM) - - 68,48Growth ratesSales (MRQ) vs Qrt 1 yr ago -34,24 -33,83 -25,00 W WSales (TTM) vs TTM 1 yr ago -17,23 -15,18 7,30 W WSales 5 yr Growth Rate -4,32 -2,51 9,74 W WEPS (MRQ) vs Qtr 1 yr ago -482,14 -88,77 -130,88 W BEPS (TTM) vs TTM 1 yr ago 28,65 -362,56 -EPS - 5 year Growth Rate - - 14,98Capital spending - 5 year Growth Rate 1,21 -2,82 16,96 W WFinancial StrengthQuick Ratio (MRQ) 0,38 1,17 0,83 W BCurrent (ratio) 0,56 1,23 1,05 W BLT Debt to Equity (MRQ) - - 47,14Total Debt to Equity (MRQ) - - 109,93Interest Coverage (TTM) - -3,42 0,01 WProfitability RatiosGross Margin (TTM) -1,09 6,49 15,38 W WGross Margin (TTM) - 5 yr average 8,41 9,96 22,03 W WEBITD Margin (TTM) -7,56 -0,61 -EBITD - 5 yr average 1,34 4,22 12,80 W W
  • 67. Bankruptcy ($M, except for shares) GM GM Ford Ford 2008 2007 2008 2007 Cash $13 953 $24 549 $22 049 $35 283 Marketable Securities 13 2 139 17 411 5 248 Receivables 7 711 9 659 6 073 8 210 Other CA 3 142 3 566 $122 422 $105 930 Inventory 13 042 14 939 8 618 10 121 Net P&E 39 656 43 017 28 565 36 239 Fire Sales $77 517 $97 869 $205 138 $201 031 CL 73 911 69 510 143 855 159 656 Net Cash $3 606 $28 359 $61 283 $41 375 LTL 100 654 109 040 90 534 107 735 Sub-total ($97 048) ($80 681) ($29 251) ($66 360) PS 0 0 0 0 Net Liquid Value ($97 048) ($80 681) ($29 251) ($66 360) WSO (in millions) 579 566 2 273 1 979 Net Liquid Value per Share -$167.61 -$142.55 -$12.87 -$33.53
  • 68. Hot News GM ‘GM slashes summer production, cites Delphi risk’ (Reuters)  ‘One of the deepest cutbacks by any of the major U.S. automakers’  13 assembly lines = 21,000 workers GMs lengthy plant closures will ripple out (Yahoo)  However, ‘Clarke said the shutdowns are not a sign that GM is headed into bankruptcy protection.’
  • 69. Hot News Ford ‘Ford seen posting Q1 loss, focuses on sector turmoil’ (Reuters) ‘Ford VP expects same concessions as GM, Chrysler’ (Yahoo)
  • 70. General Motors Corporation Ford Motors CompanyMean Recommendation (this week) 3.9 W 3.3 BMean Recommendation (last week) 3.9 W 3.4 BChange 0.0 -0.1Date March 20th, Dec. 22nd, Nov. 10th, Oct. 8th, March 20th, Dec. 22nd, Nov. 10th, Oct. 8th, 2008 2009 2008 2008 2008 2009 2008 2008 UBS Credit Suisse Barclays Deutsche UBS Credit Suisse Barclays Deutsche Capital Securities Capital SecuritiesAction Initiated Downgrade Downgrade Downgrade Initiated Downgrade Downgrade DowngradeFrom Neutral Equal Hold Neutral Equal Weight Hold WeightTo Sell Underperfor Underweight Sell Sell Underperform Underweight Sell m(Current Month) Number of Analysts Average Number of Analysts AverageStrong Buy (1) 0 analysts 0 1 analysts 1Buy (2) 0 analysts 0 0 analysts 0Hold (3) 3 analysts 9 6 analysts 18Underperform (4) 6 analysts 24 2 analysts 8Sell (5) 2 analysts 10 2 analysts 10TOTAL 11 analysts 3.91 11 analysts 3.36 Underperform W Hold B
  • 71. Company Name Growth Profitability Financial Health TotalGeneral MotorsCorporation B B F W D W D+ / SellFord MotorsCompany D W F W D+ B D / SellIndustry Average C+ D B D W D+ / Sell 3.00 3.00 2.30 2.50 2.00 1.33 1.43 General Motors Corporation 1.30 1.50 1.00 1.00 1.00 1.00 Ford Motors Company 0.77 1.00 Industry Average 0.50 0.00 0.00 0.00 Growth Profitability Financial Health Total
  • 72. Summary Analysis: Summary Analysis:GM is overvalued compared to its F is overvalued compared to itsprice of $3.62 per share, has price of $2.84 per share, hassomewhat below average safety, somewhat below average safety,and is currently rated a hold. Ford would be a better investment and is currently rated a hold. GM FValue Measure of stock’s current worth 0.00 Unlimited $0.25/share (overvalued) $0.18/share (overvalued) BRV (Relative Value) Long-term appreciation potential 0.00 2.00 0.03 (Very poor) 0.05 (Very poor) BRS (Relative Safety) Indicator of risk 0.00 2.00 0.75 (Poor) 0.79 (Poor) BRT (Relative Timing) Indicator of stock’s price trend 0.00 2.00 1.64 (Excellent) 1.70 (Excellent) BVST (VST-Vector) Vectorvest Ranking Indicator 0.00 2.00 1.10 (Good) 1.15 (Good) BRecommendation Analyst opinion Sell Buy Hold Hold(REC)GRT (Earnings GrowthRate) Indicator of earnings growth Unlimited negative Unlimited positive -9.00% (Very poor) -6.00% (Very poor) BEPS (Earnings per Indicator of 12 months Unlimited negative Unlimited positive $-33.47 $-4.22share) earnings per share BP/E (Price to earnings Measure stock Unlimited negative Unlimited positive -0.11 -0.67ratio) valuation BEY (Earnings Yield) Earnings per share as a percent of price Unlimited negative percentage Unlimited positive percentage -924.54% -148.59% BGPE (Growth to P/ERatio) Measure stock valuation Unlimited negative Unlimited positive -83.22 -8.92 B
  • 73. General Motors Corporation Ford Motors Company(Current) Number of analysts Average Number of analysts AverageBuy(1) 0 0 2 2Outperform (2) 0 0 0 0Hold (3) 2 6 5 15Underperform (4) 5 20 2 8Sell (5) 4 20 2 10No Opinion 0 0 0 0TOTAL 11 4.18 11 3.18 Underperform Hold W B
  • 74. General Motors Corporation Ford Motors Company Current Last Month Current Last MonthAverage Underweight Underweight Hold UnderweightRecommendationNumber of Ratings 12 10 12 12Date 3/20/2009 11/10/2008 10/3/2007 3/20/2009 11/10/2008 9/17/2007Broker UBS Barclays Bank of UBS Barclays Bear Stearns Capital America Capital Securities Buy Underweight OutperformNew Sell Underweight Neutral X Equal Weight Peer PerformOld X Equal Weight Sell X Cash Amid HealthComments X On Labor Price target Concerns + Care Costs Agreement at $26 Deteriorating International Business