Snappy newsletters. Simple Facebook sharing. Spirited comments. Sweet features are waiting… GET THEM NOW!

Hot on Facebook
Uproar After NC State Agent 'Fixes' Girl's Lunch Preschooler has to eat chicken nuggets instead of mom's meal »

SUV Credit Crunch Rolls Over Ford

Sinking value of big vehicles crashes auto firm's credit wing

By Rob Quinn,  Newser Staff

Posted May 30, 2008 10:18 AM CDT

(Newser) – Ford's plans to get back in the black are being forced off the road by woes at its lending arm, the Wall Street Journal reports. The auto giant made a lot of cut-rate loans on trucks and SUVs in recent  years and has been unable to recoup losses on bad loans through repossessions because of the plummeting resale value of bigger vehicles.

The credit arm may still scrape into profitability this year, but with earnings way down from last year's $1.2 billion. The company, preparing to slash jobs as sales shrink, is unlikely to spin off its troubled credit arm the way GM did. Ford has relied on profits from Ford Credit even when the economy was cruising, and the division has been proven to boost customer loyalty. 

Unsold 2008 models are reflected in the chrome grille of an unsold 2008 Edge at a Ford dealership in the south Denver suburb of Littleton, Colo., on Sunday, May 11, 2008.
Unsold 2008 models are reflected in the chrome grille of an unsold 2008 Edge at a Ford dealership in the south Denver suburb of Littleton, Colo., on Sunday, May 11, 2008.   (AP Photo/David Zalubowski)
Unsold 2008 Super Duty pickup trucks sit at a Ford dealership in the south Denver suburb of Littleton, Colo., on Sunday, May 11, 2008.
Unsold 2008 Super Duty pickup trucks sit at a Ford dealership in the south Denver suburb of Littleton, Colo., on Sunday, May 11, 2008.   (AP Photo/David Zalubowski)
A sign promoting a discounted interest rate is seen on the windshield of an unsold 2007 Ford F-150 pickup truck at a Ford dealership.
A sign promoting a discounted interest rate is seen on the windshield of an unsold 2007 Ford F-150 pickup truck at a Ford dealership.   (AP Photo/David Zalubowski, file)
« Prev« Prev | Next »Next » Slideshow
To report an error on this story, notify our editors.
A snapshot of the day's best news stories.
 
COMMENTS
Be the first to comment on this story.

More Newser Stories

Ford, Toyota Join Forces on Hybrid System

New Ford Explorer More Like a ... Taurus?

10 Cars That Changed Our Lives

AT&T Will Spend $565M to Green its Vehicle Fleet

3 Detroit Finalists Up for Car, Truck of Year


NEWS FROM OUR PARTNERS
Other Sites We Like:   24/7 Wall St.   |   Betty Confidential   |   BuzzFeed   |   Cracked   |   Fark   |   Timelines   |   The Frisky   |   Geek Sugar   |   NewsOne