GE and Ford: How Prepared Are They for the Fiscal Cliff?
Unlike General Electric (NYSE:GE), Ford (NYSE:F) isn’t so lackadaisical about the approaching fiscal cliff. GE Chief Executive Jeff Immelt and Chief Financial Officer Keith Sherin are by no means ignoring the potential problems, as Immelt was part of the group pushing President Obama to increase taxes to avert he fiscal cliff, and Sherin claims he isn’t loosing any sleep – perhaps that’s because GE North American Chief Mark Reuss already has GE prepared for the fiscal cliff with reduced costs to protect the company from large sales drops.
Though auto sales are up over the last year and Ford has posted record profits in the first 9 months of 2012, Ford is naturally concerned about a dive back into recession that could spoil its recent success. Part of Ford’s concern may come from America’s being its more reliable home-field, as the company posted $3 billion in losses in Europe and boasts only a 3 percent market-share in China. Fortunately, Edmund’s Lacey Plache believes the recession would only last until the end of 2013, and would then rebound stronger.
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Perhaps adding to the stress is the chance that soon-to-be Ford COO Mark Fields, along with others in high-income brackets, will face increased taxes in 2013, a likelihood of which GE’s Reuss is certain, and Immelt is pushing for.
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