Ford Motor Company (NYSE:F) reported a net loss of 19 cents per share for the third quarter compared to a loss of $2.79 per share a year ago. The news could signal the beginning of a successful turnaround for the troubled automaker and came as a surprise to many investors. Margins are growing, incentives are falling and sales are becoming more profitable.

Ford has traditionally been the weaker of the big three automakers as it does not have hedge fund backing, massive sales outside of the USA, or cost cutting already behind it. However, this earnings announcement indicates that they may be able to pull off a turnaround anyway. The company reported improved overseas sales, increased margins in the United States, and is ahead of its $17 billion cash outflow target for 2007-2009 period.

Ford also said it was close to selling its Jaguar and Land Rover units but its CEO said there are no longer any plans to sell the Volvo market. The company likely decided to hold off because of the lowered cost of a turnaround. The company leveraged its assets to borrow $23.4 billion last year, but now doesn't expect restructuring costs to reach even that level.

In the end, Ford is on track to reach profitability in 2009. This is a remarkable achievement given the short timeframe for their turnaround and the increased competition in the auto market. Combined, these factors make F a stock worth watching closely!

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