How many dollars is the Blue Oval Worth?

December 17, 2008 Economy clouding progress, Ford says Rivals' uncertainty also weighs on turnaround BY BRENT SNAVELY FREE PRESS BUSINESS WRITER Ford Motor Co.'s executive chairman, Bill Ford Jr., said Tuesday that the company continues to make impressive progress with its turnaround plan -- but the uncertainty hanging over its crosstown rivals, the automotive industry and the U.S. economy are making the company's fight for survival tougher every day. Ford, who is also the great-grandson of the company's founder, spoke Tuesday at an event in Dearborn to preview 2009 models and said there were several positive signs at the company these days. He said the automaker has been successfully distinguishing itself from other ailing Detroit automakers in the marketplace, and that Ford's early December sales in the United States don't actually look too bad, despite the dismal economy. "December for us is starting off relatively well," Ford said. General Motors Corp. and Chrysler LLC have said they might run out of cash soon; Ford is the only Detroit automaker not seeking financial support. Bill Ford said that point of differentiation has been good news for the company. "People are seeing we are trying to make it on our own, and I think we are hearing comments in the showroom to that effect," Ford said. Ford Motor, which recently launched the redesigned F-150 pickup, saw its market share in the United States grow by 1.5 percentage points in November, to 16.4% of all sales. In Europe, where Ford recently launched its redesigned Fiesta subcompact car, Ford increased its market share to 8.8% of all sales. Ford plans to bring the Fiesta to the United States in 2010. Despite that, Bill Ford said the uncertainty in the automotive industry is making it difficult for the company to plan for the future, even though the family-controlled automaker believes it has enough cash and credit, under current economic conditions, to make it to 2010. A $14-billion financial rescue bill for GM and Chrysler failed in the U.S. Senate last week. Now, Detroit's automakers have turned their hopes to the Bush administration, but it remains unclear how much money the administration is willing to provide or when. "I was disappointed that it did not pass because I think it would have been the right thing for our industry, and particularly, for GM and Chrysler, but ultimately for our suppliers," Ford said. "Here we are in limbo still for GM and Chrysler, and every day that passes puts more and more strain on them and the supply base." Despite the importance of the effort, Ford said he tries not to obsess about what is happening in Washington, D.C. "Every day this is changing, and every day there is a new set of conditions, a new set of strings, different amounts of money, and who knows how this is going to shake out," Ford said. "One of the things we have learned is to try not to react to absolutely every change hour-by-hour because we have a company to run, and we feel that we are on the right path. We feel like our plan is working, and that's got to be the basic focus." Some industry analysts said that fewer than 12 million vehicles will be sold in the United States in 2009. If true, that would mean 2009 would be an even tougher year than this year. Bill Ford acknowledged that the selling environment could erode further. "At a certain point, if customers are just stressed out and tapped out, all the messaging in the world is not going to get them in" to visit dealerships, Ford said. But Ford President and CEO Alan Mulally said Ford's goal is to make a profit no matter how low industry sales go, and he said the company has been making progress toward greater flexibility in recent years. Ford has announced the closure of 17 plants and eliminated 45,000 hourly employees and 12,000 salaried jobs in North America and since 2005. "Whatever the market is, we are going to size ourselves to make money," Mulally said. Contact BRENT SNAVELY at 313-222-6512 or bsnavely@freepress.com.