Ford has now reduced it's shareholding in Mazda to just 13% - although it still remains the biggest single shareholder.
IMO this gives them the opportunity to raise lots of dosh (obviously) but also it enables them to keep strong links with a well known Japanese company which will continue to help them develop more and more reliable products at less cost.
Edited by Pendlebury on 18/11/2008 at 18:00
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"IMO this gives them the opportunity to raise lots of dosh "
They got back a lot less than invested in Jaguar and Land Rover from TATA for the two of them. Their stake in a small Japanese car manufacturer (being a small stake anyway) cannot be worth much but they need cash.
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If you are in the business of selling things and you need to make cash in a hurry to keep the business afloat you sell whatever it is you sell at BIG discounts. Everyone in business knows that.
Ford ain't doing this so I assume they have loads of cash and are not in trouble.
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One of the brokers who advertises here was offering main dealer supplied, delivered and road taxed Mondeos @ £6000 off. Obviously it was an well specced car. Peugeot 607s @ 47% off last month too.
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Selling off chunks of the business is a panic measure and does not address the core issue. Ford (and GM) need to sell cars in the US that are appropriate for our times, not the late 20th century when fuel was cheap. They make such cars for the European market - and very good most of them are too.
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Ford, GM and Chrysler have requested $25bn in aid... selling a stake in Mazda is pocket money.
They do need to sell cars but also held back by pensions and health cover for their retired workforce.
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Quite so rtj70. One of the business papers recently described the large US manufacturers as "Health Care and Pension Providers, who build cars on the side". It was also stated that they make more profit from financing the sales of their cars than they do from the actual sales of the metal.
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US medical provision is grossly inefficient and costs have risen so high that its putting a drag on US business. Medical costs will soon soak up about 20% of US GDP and provide cover for only about two thirds of the population. Its reckoned that for every clinician there are about three administrators required to process and argue the insurance claims.
In the past GM opposed reform of US healthcare because it had (still has?) substantial interests in medicine.
BR'ers should know that some of the companies responsible for pushing US healthcare costs to stratospheric levels employ 'researchers' in the UK whose job it is to uncover 'bad news stories' about the NHS and pass them on to friendly journalists and politicians. With the political tide turning against them in the US they need to expand into new markets overseas.
European state health provision is generally much cheaper, more efficient, and consumes less than half the GDP of the US system, mostly with universal coverage. This has advantages for business, as we see, as well as the general populace.
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I am shop steward, but can't help worrying that Car making in the USA at the moment reflects some of the problems seen in BL in the UK in the 1970's.
Design technology and implementation falling behind competitors (in the US, not Europe), old (in relative terms) inefficient plants, high employment costs due to strong union demands when times were good.
IF Ford threaten closures and modernisation I guess there will be an all out strike? (Like BL).
I really hope that unions/management will actually try to work out things together to save the industry in the US.
Question is how is Ford doing outside USA? One theory maybe as people downsize, they stop buying BMW's and start buying Focus's etc with their big discounts.
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According to an article I just read, Ford's North American operation lost $1.3bn pre-tax in Q2 2008. European operations posted a $582m pre-tax profit which is not too shabby in 3 months. South America was also quite profitable. The finance division lost money though, which perhaps isn't a shock given the economic events of late.
Given what is probably the strongest overall range of products from any mainstream manufacturer right now, it would be tragic if Ford Europe weren't profitable.
Edited by DP on 19/11/2008 at 10:43
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