By on November 10, 2009

Bomb thrower? (courtesy 1.bp.blogspot.com)

Responding to TTAC commentator Ohsnapback, Ford’s Communications rep defended his employer’s turnaround plan. “At Ford we have never said that we have won the battle already,” Jay Ward wrote. “Just that we are making considerable progress against our plan. You are right that the job is not done, but the evidence so far is overwhealmingly [sic] positive.” So far, so PR. And then . . . “We are managing our debt and working hard to pay it off. We are also going to pay back our loans unlike other companies (not just automotive – how about the banks while we are on the subject).” It’s a blunt and entirely accurate appraisal of GM and Chrysler’s chances of returning the government’s $72 billion (plus) “investment” in the failed domestic automakers. Ward goes on to underline Ford’s official position that its $10 billion no-to-low interest, 25-year “retooling” loan from the Department of Energy does not constitute a government bailout. ” . . . we did shun bail out money. We accepted government loans available to all auto manufacturers both domestic and foreign. We have committed to paying these back and I fail to see how we can be critisised [sic] for that.” And just in case you thought the attack on GM and Chrysler’s mega-suckle was a slip of the tongue, Ward makes a second strafing run. “If everyone else pays back every penny that Uncle Sam has ‘loaned’ them, I will eat my Mustang and my Flex.” Jay’s cars are safe. His ability to post on TTAC without interference from The Glass House Gang? Not so much.

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26 Comments on “Ford PR: “We are also going to pay back our loans unlike other companies”...”


  • avatar
    Durwood

    It just amazes me how much some people here want Ford to fail so they can say “i told u so”. Saving face seems so much more important to them then Ford surviving. Forgive me, but i don’t understand the “piling on” mentality. With as bad as the economy is now , what Ford has done is nothing short of miraculous to me. I appreciate everything u have done Ford and i only hope u keep the momentum up despite what all the naysayers say. And i have bought 8 new cars over the years. 6 chevys, 1 dodge and 1 mercury . And my next will be a Ford.

  • avatar
    Matt51

    I own a 2001 Town Car, a 2006 Mustang, and a 1998 Ford Contour. All bought new. I have nothing against Ford. But, they have too much debt, too many cars which don’t sell. They have two world class products. The F150, which is a mass market vehicle, and the Mustang, which is a niche vehicle. The market for large pickups will never again be as large as it once was. Those days are gone.
    Lincoln is a mess, Mercury is dead. Ford is trying to push turbocharging, which is a mistake. So what home runs does Ford have coming? None that I can see. Taurus sales are probably too low to recover the investment. What Ford has become, is a Truck company, unsuccessfully trying to penetrate the car market. What meager profit Ford makes, before they plunge back into losses, is from the F150. And the Chevy and Dodge trucks are just as good. As Bob Lutz said at Chrysler, as he pushed to replace the K cars: You won’t sell very many cars if you are everyone’s second choice.

  • avatar

    Jay, that was refreshing. Don’t let your bosses rein you in. I haven’t owned a Ford in years, but due to all of what you said and more, I would at least consider one today. I can’t say the same of GM or Chrysler.

  • avatar
    don1967

    Sounds like Ford insiders are feeling emboldened by all the positive hysteria they’re getting these days.    But being Not GM can only get them so far.   With such a precarious financial position, and such a dubious product direction (“turbo Taurus” has disaster written all over it, like “diesel Oldsmobile”), they might want to avoid any perception of arrogance.  It’s bad Karma.

  • avatar
    dougjp

    Jay couldn’t have picked better words. Incentive-type loans available to all if they qualify have nothing to do with Companies receiving ‘bailouts’ in terms of anything they could be criticised for, and everything to do with the politicians that created them.
    However I just shake my head about all the praise Ford gets. They did nothing except forward planning in the amount any Company should be expected to do.  All they did was borrow heavily when (a) they didn’t need the money urgently and (b) loans were readily available.
     

  • avatar
    NulloModo

    dougjp -
    It’s fair to say there was quite a bit more done that just borrowing money in advance of the storm (although I will admit that has helped quite a bit).   The product upgrades, new models, and commitment to regular 3 to 4 year refresh cycles to keep the good products getting better are also doing a lot to drive consumer confidence and drive sales.
     
    Matt51 -
     
    The D3 have a lengthy list of mistakes in the past that helped lead to the current conditions.  Letting good products wither on the vine, developing cars that weren’t competitive from the get-go, and rampant badge engineering are all amongst them.  In recent years however Ford has done a lot to fix those shortcomings.
     
    The F150 and Mustang are hardly the only world class products from Ford.  The Fusion has been reviewed very well by almost everyone, and is every bit as good as the Accord or Camry.  The Flex garners praise from almost every source as well, as is likewise an excellent alternative to the Pilot, Highlander, or Traverse.  The new Taurus is selling well thus far, and is every bit as nice if not nicer than the Avalon, Accord, or 300.  The Edge holds up very well to the Murano, Venza, and other medium-ish crossovers.  The Focus isn’t class leading yet, but it is far better than any of the domestic competitors and with the next redesign should eclipse the Civic and Mazda3 as well.
     
    Warranty costs have gone way down, and that combined with reports from numerous third party sources and surveys show that reliability and dependability is way up across the board.  The product with the biggest trouble spots, the diesel Super Duty trucks, are coming out heavily redesigned with a brand new from the ground up diesel engine next year.
     
    Badge engineering has been cut back, and while most Lincolns are based on Ford platforms, the completely new sheetmetal and interiors do a lot to differentiate the products.  Mercury is being scaled back but still has one important job – to give standalone Lincoln-Mercury dealers a full line of cars to sell.  As Ford continues to push those standalone dealers to sell out and merge with Ford stores, and as Lincoln’s lineup files in any holes, Mercury will continue to fade until it is no longer needed.
     
    As far as the turbocharging goes, thus far the EcoBoost engines have lived up to their promise of V8 performance with V6 fuel economy, but the real test will be the EcoBoost 4 cylinders offering V6 performance with 4 cylinder fuel economy.  As those roll out in the next year, I predict a lot of great buzz and consumer uptake on that engine option.

  • avatar
    Contrarian

    Good for him defending Ford, and I hope they continue to. Regardless of their eventual success, lack of frank and open discussion is one of the [many] things that killed GM.

  • avatar
    John Horner

    In the competitive arena I have long since resigned myself to the idea that the least screwed up companies win, because every company is pretty screwed up. Even with all the debt it is sitting on, Ford is one of the less screwed up companies in the global auto business these days.

  • avatar
    mtymsi

    I think with the upcoming Fiesta and new Focus models Ford will have a completely competitive car line up and going forward won’t have just the F-150 as the only class competitive mainstream vehicle. Two years from now it will be interesting to see how Ford is doing, my guess is both of those upcoming vehicles will sell very well. They will also have another two years of  quality track record to give consumers another reason to visit their showrooms.

    It seems that no matter what Ford does it results in a negative TTAC editorial slant. Not sure why but I think you’d have a hard time criticizing both Ford’s quality track record and their upcoming products. The Fiesta is after all a big success in Europe as is the Focus.

  • avatar
    friedclams

    The spelling was a lot better on the Bullwinkle show, Jay Ward has truly fallen.

  • avatar
    Mr Carpenter

    I’m in the market for a new vehicle, and won’t shop Chrysler or GM, but have been trying to shop Ford.   Don’t really have anything that I like, though.  I wish they did. 

    I’d be ready to support them if so. 

  • avatar
    Mark MacInnis

    I hope Ford succeeds.  The way to do so, however, is to be REALISTIC about the challenges they STILL FACE in their fight for survival.  Their debt load, as I have written, is still a serious threat because it is a fixed cost which most of their competitors do not have….

    For decades the D2.701, including Ford, fumbled, bumbled and stumbled their way to ignominious bankruptcy (in Ford’s case, not quite as bad)…due to failure to be realistic about their challenges.  Denial is an ugly thing.  Or, paraphrasing the way  Aldous Huxley put it, “Failure to recognize facts does not make them disappear.”

    Add: it is good to see anger and passion from a Ford spokesperson. If the rank and file of Ford associates have that kind of fire in the belly, that is an intangible asset, a motivator to success.

  • avatar
    jamie1

    All,

    Apologies for my spelling. It was late and I was typing fast! There is no excuse for poor spelling.

    As to my Rocky and Bullwinkle days, I was a better speller than that bloody moose!

    Kind regards to all,

    Jay Ward

  • avatar
    mattstairs

    Matt51, I’m curious why you think turbocharging is a mistake.  Seems like a logical way for automakers to meet the tougher CAFE standards.  Do you think diesel or hybrids are a better option?

  • avatar
    SkiD666

    Sometimes, I just don’t get people on this site.
    Chrysler – does anyone seriously believe that they will survive that much longer?
    GM – with their restructering of legacy costs by shedding debt, they are only a few smart decisions away from being a viable and profitable car company (it remains to be seen if their leadership is up to the challenge) because of the infrastructure they have inplace they have the ability to become very competitive globally.

    Ford – had the stars align to put them in a good position but they still have an enormous debt load to retire and have to be very careful they don’t screw it up.
    - they lucked out with the timing of getting money before the markets crashed
    - they got a half decent CEO that hasn’t made any major mistakes to lead them through the tough times
    - the company was just the right size to weather the storm (not too big or small)
    - they were able to piggyback on some of the cost cutting measures brought about by GM and Chrysler (UAW,etc.) troubles
    -  they received a 10 billion ‘bail out’ loan that the general public doesn’t know about and are benefiting from the ‘Government Motors’ backlash
    - benefited from Cash for Clunkers initiative to get rid of stale stock on car lots
    - gas prices are down so that the F150 still sells in reasonable profitable volumes

  • avatar
    SegwayCop

    On the topic of bailouts, there were articles in March about Ford accessing a FED program (TALF) exchanging bonds backed by car loans for new cash.

    http://www.marketwatch.com/story/ford-marketing-talf-eligible-bond-deal

    Am I wrong on understanding this or would this not constitute a “bailout”?

  • avatar
    Pch101

    they lucked out with the timing of getting money before the markets crashed

    Referring to it as “luck” dismisses the role of good management in leading turnarounds.

    Mulally made the best choice in taking on debt early in the game, so that the company could finance the turnaround.  The alternative would have been to run out of cash, which would have meant no turnaround (and most likely a near-GM-sized bailout.) His choice was straight out of the turnaround playbook, while it’s clear from his actions that Rick Wagoner did not know the first thing about turnarounds.

    Ford is managing the balance sheet quite well.  At the current pace, the debt will be reduced to competitive levels within a few years.

    Their debt load, as I have written, is still a serious threat because it is a fixed cost which most of their competitors do not have

    You continue to overstate the issue, and miss the facts that most of the debt is within the finance arm of the business, not operations, and that the company is obviously succeeding in its efforts to reduce LT debt.   It won’t prove to be more than a medium-term hiccup if Ford can field competitive products and sell sufficient numbers of them at a profit.

    Ford’s greatest challenges are to increase revenues and to push its stock value.  The North American lineup is mediocre, so it’s in only a fair position to accomplish both.  Since it seems unlikely that Ford will ever get a passenger car to sell in the same volumes as the leaders Toyota and Honda, it will have to make do with fewer unit sales per nameplate, which makes things that much tougher.  The F-150 had better remain a top seller, because they’re going to need it.
     
     

  • avatar
    superbadd75

    While it is true that Ford didn’t take bailout bucks from the Federales, they are still leveraged to the hilt and face many of the same challenges as GM and Chrysler. Ford is every bit as dependent on truck sales as The General, and although their new and upcoming car models look promising, they still have a lot of negative public perception to overcome in order to move the metal. There seems to be an awful lot of sentiment that people jumping the GM and Chrysler ships are going to swim to Ford’s shores, and I just don’t get why anyone would make that assumption. Honda, Toyota, and Hyundai have excellent products to offer and a better reputation than anything domestic these days. In order to succeed and pay off their loans (public and private), Ford’s got a long road ahead. They’ve got to consistently remain profitable, and that means winning over public confidence and selling cars to people that would have never even considered American cars before. It means that they’re going to have to step up their game even more. Ford said all through the ’80s that quality was Job #1, when clearly it wasn’t. What does that say about their promises now? Don’t tell me what you’re going to do, FoMoCo, show me. It’s time to put up or shut up.

  • avatar
    WildBill

    I’m rooting for Ford to succeed, they are the only domestic that I would even consider buying. I’ve owned an ’89 Club Wagon van (since “clunked” for $4,500!) and still have a ’94 Ranger 4WD and a 2000 Expedition Eddie Bauer that is my tow vehicle. They’ve give good service but many more repairs than the Toyota’s and Honda’s and Subaru that are and have been the daily drivers.

    Off topic a bit: I do wish Ford would step up and admit a design flaw in the earlier 5.4 V8s that cause them to spit out the spark plugs, and offer some assistance when there are problems… just paid $485 for a repair to the #7 cylinder that the dealer won’t guarantee to hold. The ‘net is full of horror stories about this problem. After reading some of them and how folks got ripped off,  I got off cheap. Come on, Ford. You are better than this!

  • avatar
    YZS

    While Ford’s still faces many big challenges ahead, they have done much better than those other two domestics.  Although I haven’t owned any Fords, they have several products that I would buy if I were in the market for a truck (F150), a muscle car (Mustang), or a minivan (Flex, not Windstar).  The problem is that the Taurus and Focus are merely keeping up with the imports, while a commendable effort, keeping up is simply not going to cut it when the Japanese have so much momentum and loyal customer base.  The bad thing is, those two cars are where the bread is. 
     
    The global growth is also uneven.  In America, it will be great because being competent, and not GM/Chrysler is enough for a lot of folks.  Ford is set to gain a good slice of market share for years to come as long as they keep up the quality and not have any major botched cars.  In China, Ford is behind GM big time, and is not seen as a compelling alternative to the Japanese or the Germans.  But they have a major opportunity there because their cars are pretty good, it’s just the marketing that needs some help.  But the silver lining is that they only need to focus on beating the Germans, and really, that only means VW because Ford isn’t playing on the same field as MB and BMW.  The Japanese have no chance if they can pull that off (yes, because of old wounds from WWII, the Germans and Chinese have no major animosity to speak of).  This isn’t hard to do, but it will take a lot of money and a commitment from the top execs to make those kinds of investments.  There is a lot of opportunity for disruptive marketing in China from an established American brand with deep pockets. 
     
    Lastly, maybe I’m dreaming a bit, but if they put half suicide rear doors on the Mustang (RX8 style) and maybe offer a AWD option, the potential market for it goes up by an order of magnitude.  All the car nuts toting car seats will have an American performance alternative other than the dead offering from Pontiac, and the Taurus can be tuned even softer for the appliance drivers.  The Chrysler 4 door muscle car offerings aren’t even worth talking about.

  • avatar
    M1EK

    Ford deserves to live simply because if you get a Focus at the rental car counter instead of a Cobalt or Aveo or Caliber or (shudder) neon, you don’t get the feeling the manufacturer of the car actually wishes you had gone somewhere else.

    Everything else pales next to the contempt shown to small-car buyers by the Bailed-Outed 2.

  • avatar
    TrailerTrash

    Matt51…
    What was so costly for the Taurus intro? It has the Vovle chassis, been around Ford sinse the FiveHundred. Its a priced down MKS with less expensive parts….
    So what is the problem?

    I think the fact that we have someone from one, hell any, auto manufacturer reading and responding is refreshing.
    And actually a slap on the back for TTAC.

    Ford has problems.  I think the fit and finish of even their best Lincoln (MKS) needs tightening. Union wars to come. The uneven playing field.

    But this is a global company with pretty class leading cars in Europe.
    I for one like tubos and look forwad to these in the up coming small cars, should Ford do this.

    PLEASE Jay, tell them we need a FusionS,  Fiesta and Kuga with Ecoboost.

  • avatar
    TrailerTrash

    Matt51

    Why do you say the Taurus was to costly to do?  Its a chassis they have been using for a long time after getting Volvo.
    And what’s wrong with turbo?

    Jay…go back and tell Ford big thinkers we are in need of turbo FusionS, Fiesta and Kuga!

    And thanks for participationg.  If feels real nice knowing your words are being read.

  • avatar
    Steven02

    What was the point in making this an article?  Sure he defends his company.  His company, under Alan Mulally, has made some great strides.  They still have problems.  They still have a lot of debt to manage.  They are working to fix them.  But if you look at it through TTAC’s  baised truth about cars glasses, you will only see failures in anything that any domestic automaker does.

  • avatar
    Matt51

    Trailer Trash, they are selling what, 5000 a month, or 60,000 a year? No way they are making money on it.

  • avatar
    charly

    YZS,
    The French and Italians also play in China so it isn’t only VW they need to beat.


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