Chrysler and GM could take a few lessons from the Ford Motor Company. Unlike those two, Ford has seen the future and is moving toward it - FAST.
On December 8, 2008 Ford dropped a bombshell on Congress. They told the government they didn't necessarily NEED a bailout. They asked that Congress make up to $9 billion available in a 'bridge loan', but told Congress they may not use it. (It's actually a line of credit on a ten-year revolving account, and it must be paid back in regular installments.)
To date, Ford has not taken the money, and it looks like they won't have to, anyway. This happens when a company sees the future, listens to the public, and moves toward both with intelligence.
Ten Reasons Ford is Prospering in the Midst of a Recession:
1) They Saw It Coming - Ford did not wait for the economic crisis to hit before they started restructuring the way they do business. By the time the crisis hit, they were in much better shape than their competitors. They expect to make a profit, or at least break even, through 2011.
2) They Actually SUPPORT Their American Competitors - Eighty percent of the people who own a Ford dealership also own a competitor's dealership. Ford does NOT want Chrysler or GM to go bankrupt, saying this would hurt rather than help them.
3) No Wall Street Greed in Dearborn, Michigan - Ford is canceling all bonuses to be paid in 2009 for all management employees worldwide and foregoing bonuses for all employees in North America. The company also will not pay merit increases for North America salaried employees in 2009.
4) America First - The company is going American all the way, on a worldwide basis. Since 2007, Ford has sold their interests in Aston Martin, Jaguar, Land Rover and the majority of its stake in Mazda. They are actively pursuing selling their stake in Volvo as well.
5) Goin' Green For Real - They have committed $14 billion dollars in new funding for the development of alternative technologies to both power cars and make them more fuel-efficient. How efficient? From its largest light duty trucks to its smallest cars, Ford will improve the fuel economy of its fleet an average of 14 percent for 2009 models, 26 percent for 2012 models and 36 percent for 2015 models. They estimate a savings of 16 billion gallons of fuel for America over the next ten years.
6) Goin' Green For Real at a Realistic Price - In 2010 Ford will introduce an all-electric van suitable for fleet work, and in 2011, an all-electric sedan. They claim that by reducing overhead now, they can make these vehicles comparable in cost to gasoline vehicles. Ford is on the fast-track for this project, and they are investing heavily in electric. They have also heard the complaints about cost, lack of range, and small size. They say they are addressing these issues fully.
7) Slimming and Trimming - Ford is selling its five corporate aircraft. The CEO says he will work for a dollar a year. Enough said.
8) Painful, but Smart Restructuring - Ford has consolidated its suppliers by more than 50%. Although this did put some people out of work, Ford says they had too many parts spread out over too many companies. They tried to favor American companies when making the decisions about cuts, although they do build cars in other countries. Mainly, they tried to keep it local wherever they could. In addition, since demand for cars is down, especially gasoline-only vehicles, Ford has closed a total of six plants. They may re-open these later when the economy recovers and hybrids and electrics become the norm.
9) They've Seen the Future - Ford has announced that a full 80% of funding for all NEW vehicles will be for hybrids or full-electric vehicles. Basically, they are phasing out gasoline-only vehicles, which will soon be in the minority at the Ford dealerships.
10) Using Obama's Plan to Their Advantage - Half of the Ford, Lincoln and Mercury light-duty vehicles by 2010 will qualify as 'Advanced Technology Vehicles'. – increasing to 75 percent in 2011 and more than 90 percent in 2014. This would qualify them for investments under President Obama's green technology plan. Couple that with their own $14 billion investment in green tech and you have a car company who is definitely going to emerge from the recession even stronger than before.
On a personal note, my kudos go out to Ford and the brainy boys in Dearborn who saw the light - and who will undoubtedly increase their market share substantially in the years to come.
