Bold Breakthroughs
Automakers Winners & Losers: Ford
The Associated Press
11/24/08 - 03:14 PM EST
NEW YORK -- Shares of major automakers rose on Monday as the broader market rallied and President-elect Barack Obama said he expects the government to "shape a rescue" of the U.S. auto industry.
Stocks climbed across the market after the federal government agreed to inject a fresh $20 billion into Citigroup (C) to help rescue the beleaguered banking giant. In mid-afternoon trading, the Dow Jones Industrial Average was up more than 3% and the Standard & Poor's 500 had gained 4.5%.
Meanwhile, Obama said in a press conference he was surprised the Detroit Three did not have a better-thought-out plan for their future before asking Congress to approve $25 billion in emergency loans. Once he sees the automakers' plan for how they will use the money, Obama said "we're going to be able to shape a rescue."
Executives from General Motors (GM), Ford (F) and Chrysler LLC went before Congress last week to ask for $25 billion in loans, but Congressional Democrats were unwilling to hand over any money without a better idea for how they plan to return to viability.
The imperiled automakers have warned that a failure of one of the three could endanger the entire auto industry. Earlier this month, both GM and Ford reported mounting quarterly losses, with GM saying it may not have enough cash to survive into next year.
Shares of GM rose 53 cents, or 17.32%, to $3.59 in afternoon trading. Ford shares added 13 cents, or 9.09%, to $1.56.
U.S.-traded shares of foreign automakers also advanced. Honda (HMC) shares climbed 1.16 cents, or 5.71%, to $21.47. Toyota (TM) gained $3.42, or 5.37%, to $67.10. Nissan Motor (NSANY) jumped 45 cents, or 6.31%, to $7.58. Daimler AG (DAI) rose $4.21, or 16.06%, to $30.42.