Ford Motor Company has announced its second-quarter results for 2010, and the company says it earned $2.6b over the last three months on $2.9b in operating profit before special items. In a departure from the typical model for domestic automakers, Ford’s growth was largely driven by improvement in North American results: Ford earned $1.9b in pre-tax operating profits in North America after boosting its Ford brand to the top spot in the American market over the first six months of 2010. Ford earned $31.3b in Q2 revenue, a $4.5b improvement over Q2 2009 (a $7.4b improvement excluding Volvo). Ford’s operating cash flow improved by $2.6b despite ending the quarter with $21.9b in cash, a $3.4b drop since the end of Q1. However, that drop in cash-on-hand was the result of a $3.8b debt reduction, and Ford figures its total automotive liquidity (including all credit facilities) is $25.4b. Automotive debt was reduced by about $7b, to $27.3b, the result of both the UAW Retiree Medical Benefit trust buydown and a $3b repayment of a revolving credit line. The shutdown of Mercury has reportedly cost Ford about $229m so far, and Ford expects that amount to equal slightly under half of the total cost of eliminating the brand.

Ford’s results aren’t very surprising given the fact that it Ford brand outsold all other brands over the first half of 2010, but the healthy profit shows that a rumored dependence on fleet sales wasn’t enough of a factor to weaken Ford’s financial results. Though debt levels remain high and its overseas performance remains weak, Ford has proven once again that it’s the healthiest American automaker… if only in terms of its North American market performance.

Full financial release in PDF format here, Q2 results presentation slides in PDF format here, Ford Credit results in PDF format here

After months of speculation about GM’s re-entry into the subprime lending market, The General has announced a deal in which it will purchase the lender AmeriCredit for $3.5b. Founded in 1992, and managing assets worth $10b, AmeriCredit has been pursued by GM for the last month, according to GM CFO Chris Liddell in the WSJ [sub]. GM paid AmeriCredit stockholders $24.50 per share for a controlling interest in the firm, a 24 percent premium over its $19.70 closing price yesterday. Still, GM insists that acquiring AmeriCredit will have “a minimal impact” on its balance sheet, although no explanation is given as to how. $3.5b is at least ten percent of GM’s cash pile at this point, and it’s not clear if that qualifies it as a “minimal impact” or if GM is using some kind of financial instrument to purchase the firm. AmeriCredit says it will “expand its offerings” to support GM, likely in the area of lease deals, but it will also continue to offer loans to non-GM-brand car deals.

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Volkswagen is betting big on China. Volkswagen wants to double their production capacity in China to three million vehicles by 2013/14. That is roughly half of their current worldwide production. To do that, Volkswagen will finally build their long rumored, but often denied second new plant in China.  A week ago, Volkswagen had announced that they would build a plant with their northern partner FAW in China’s deep south. Read More >

The shortage of a critical computer chip that Hitachi desperately needs to supply Nissan with ECUs  now threatens to affect U.S. production. Yesterday, Nissan warned that they will close down Japanese assembly lines. Today, Nissan COO Officer Toshiyuki Shiga said that production in the U.S. may be halted until the chip shortage is solved. Read More >

The best-selling nameplates in America may still be pickup trucks, but for the first time in nearly a decade, cars and car-based crossovers are outselling the body-on-frame competition. The shift occurred in the second half of 2007, as gas prices built to their Summer 2008 peak, and despite more reasonable energy prices, consumers do not appear to be going back to large trucks and SUVs en masse. And, as Automotive News [sub] reports, the downsizing of America’s buying tastes is doing more than just putting a fork in the SUV fad.

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Two news items are unnerving Japan today: The ruling DPJ party seems to be heading towards a solid defeat at the upper house elections. And Volkswagen has lost all respect for the Japanese competition. The enemy Volkswagen now fears most is – dou shiyou – Read More >

Wasn’t Ford proud of not having stuffed themselves from the Great American Bailout Buffet? That didn’t stop them from (quietly) asking the Germans for money. And the answer is … Read More >

Speaking of German car companies doing exceptionally well despite a tanking German car market, there is of course Volkswagen.

The Volkswagen group sold more than 3.5m units worldwide in the first six months of 2010, besting the pretty darn good numbers of the same period in 2009 by about 15 percent, Martin Winterkorn said to Reuters. He predicts (and that’s an easy call based on the half year results) that the Volkswagen group will see record car sales in 2010. What’s driving the new Wirtschaftswunder? The weak Euro, of course. And the strong position of Volkswagen in boom markets such as China.

Nevertheless, VW doesn’t want to rely on the vagaries of the foreign exchange. Read More >

Still convinced that the Yen is undervalued? Japanese carmakers beg to differ. They think the Japanese currency became so expensive that it gets cheaper for them to build abroad and to import to Japan. We’ve reported that Nissan is moving the production of their Micra (called March in Asia) to Thailand. When they did this, The Nikkei [sub] saw “huge implications for the future of the Japanese auto industry as a whole.” It certainly looks like Nissan’s exodus to the Land Of Smiles (and occasional riots) started a trend. Read More >

“2010 could become the best year in the history of the automobile,” said Daimler’s Zetsche today, while Automobilwoche [sub] was furiously scribbling notes. “The best times of the car are in front of us.” Times are especially well for manufacturers for luxury cars. Had Dr. Z been drinking? Not necessarily. Read More >

As the following table will demonstrate, June sales rose a tepid 14 percent over an extremely low June in the year before. 860,004 light vehicles had changed hands in June 2009, a drop of 27.7 percent from June 2008. This June, 983,821vehicles left dealer lots, nowhere near the 1,189,518 units that were sold in June 2008. Read More >

It’s that time of the month again. Today, sales in the U.S. will be reported. “Yucky” will probably be their nicest adjective. “U.S. auto sales this month probably posted the smallest increase since February as consumers concerned about unemployment and the economy avoid large purchases, analysts said” to Bloomberg.

Analysts polled by Bloomberg think June SAAR will be anywhere between 10.4 and 11m, the averaged number comes out to an annualized rate of 11.2 million units. More than last year’s horrendous June number of 9.7m, but less than 11.6 million in May. There will be little reason to celebrate. Read More >

It’s safe to buy Ford again. Ford as in the F share. After trading at close to $15 in April, it could be had below $10 yesterday. A bargain. Or so it seems. Read More >

An odd collection of 35 companies and organizations, amongst them the correspondence school Benesse, and the convenience store chain Lawsons, established an association yesterday in Japan to promote electric vehicles. It’s called “APEV,” as in “Association for the Promotion of Electric Vehicles.” (Apparently, beyond Japan.) There is only one problem … Read More >

The NRA, the Pope, Porsche and Piech, all eyes were on the Supreme Court for the last few days: Gun owners watched the Chicago case (right to arm bears upheld.) Accountants and CPAs monitored the treatment of their favorite boondoggle, a.k.a. Sarbanes-Oxley (upheld.) Rome said “oh my God” when they heard that a lawsuit that accuses the Vatican of conspiring with U.S. church officials to cover up sex abuse could proceed. Meanwhile, Germany’s attention, from Zuffenhausen to Wolfsburg, was fixated on Morrison v. National Australia Bank, No. 08-1191.  The Supreme Court seriously frustrated attemps by overseas investors who want to drag non-American companies into American courts. Champagne corks popped at Volkswagen and Porsche. The Guardian: “America’s supreme court has told prospective European claimants to take their claims back to Europe.” So what does that have to do with Porsche? Read More >