We could be ~ 10 years from witnessing the dismal tragedy of watching the most prolific American brand of the 20th century go bankrupt or worse, get sold for parts like a cheap piece of junk.
It’s time to end the currently available templates; using the changing of CEO’s and slowly managing the business to an effective death. Like bleeding chips at the poker table and getting absolutely buffeted by a game that’s getting way out ahead of you.
The current market capitalization of the company that monetized mobility is 32B dollars USD. That’s compared to 150B dollar valuation for Netflix; 1.5T dollar valuation for Apple; 150B for Tesla; 45B for Ferrari amongst a few reputable names so you can get an idea of scale and size in the capital markets today.
What you can infer from this mental sizing graph – is that Ford’s valuation – that’s absolutely nothing. It’s a rounding error in the global scheme of things.
One of the most recognizable names in the world, akin to a Coca-cola, with a footprint in every local market imaginable can barely scrape together a decent valuation in a world of overblown expectations and inflated valuations? Their brand alone should muster up this valuation.
Laden with debt; operations that involve an unavoidably expensive physical footprint; caught in an unforgiving decline of car ownership; and trying to turn their methods hard-right in an ocean where others have the ability to pivot instantly.
The unforgiving US stock market has amped up the pressure on Ford and held it accountable to show up and play by choking the company by the throat under water for 2 years (shares have traded between $5-$8) while giving other promising companies a rise of > than 20B in valuations in under a week (Tesla moved from $250 to $900 in 2 weeks).
It’s time to stop being a car company and reposition itself up as technology behemoth that is going to take responsibility for imagining and setting the tone for how consumers will interact with the world through this century.
Below is sequence of events that occur in our view of the world, in which we see Ford being one of the most important global business partners in the world and is managed by a strong vision for the future through a collaboration of key business-unit partners to carry the firm into the future.
Ford will continue to be in the automotive business and maintain an ‘Automotive Division’ where most of the company’s current valuation must be captured.
It will immediately set in motion a series of activities to raise its capital balance & capital reserves through a network of investors and banks. Ford will also engage in divesting a series of physical US & European assets to raise capital to add to its reserves.
Ford will initiate a series of mergers & acquisitions to bolster its asset portfolio by exerting its capital, vision and stock balance. It will engage in buying or establishing a series of high-growth assets in the areas of Aerospace; Military & Defence; Technology Services; Software Solutions; Consulting Services; Industrial Machining; Media Solutions.
Ford will announce the immediate setup & launch of the following business units – Ford Aerospace; Ford Automotive; Ford Technology; Ford Heavy Industries; Ford Entertainment Media.
A CEO that sees and understands this vision; and cares deeply about building their legacy based-off effecting the outcome of Ford’s new businesses will be the glue that holds everything together. It’s a long journey which the company will take anyway. Either by managing their balance sheet all-the-way to the bottom or by getting into a journey to envision the future for themselves and their potential customers. Ford will need a Disney-style consortium of CEO’s that can help manage & align the businesses.
In another world, there will be a time when Ford comes up against an unwitting competitor. When Uber finally pushes the concept of car-ownership off a cliff this decade, what will be left is a disastrous rubble of debt and high-cost physical assets that car companies are left holding the bags for.
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