By on July 12, 2010

Ford has once again snagged aid from a European government, as The Wall Street Journal [sub] reports that the British government has approved a £360m ($543m) guarantee on a £450 ($676.4m) European Investment Bank loan to The Blue Oval. The money will be used to fund a £1.5b ($2.25b) investment in four British Ford manufacturing sites. In an official statement, British Business Minister Mark Prisk said

[Ford’s] investment of GBP1.5 billion over the next five years is a great opportunity to take the lead in developing low-carbon manufacturing. This backing from the government will help to ensure the long-term success of manufacturing in the U.K. and make sure we are at the forefront of new technologies

The money will be used to safeguard 2,800 British jobs, and help Ford develop a new generation of low-carbon engines as well as for development of commercial vehicles. This despite the fact that Ford of Europe had previously laid into GM’s persistent requests for European aid in restructuring its Opel division.

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32 Comments on “Ford Scores More European Aid...”


  • avatar
    twotone

    Great poster. Nice to see that Ford was environmentally conscious back then.

    Twotone

    • 0 avatar
      RogerB34

      The ad was a projection of the future as Ford began production at Dagenham in 1931. The first Ford factory in the UK was in Trafford Park, Manchester 1911.

    • 0 avatar
      Robert.Walter

      In the days of steam-power, smoke stacks with billowing clouds of black-grey smoke coming out of them were synonomus with productivity in industrial and transportation ads (think RR locomotives). Anethma after the 40/50’s, this exhaust was airbrused less, or out, of rhe pic.

  • avatar
    NulloModo

    It’s not aid it’s an incentive by the EU and the British Government for Ford to invest further in the UK. Aid is something you send to earthquake victims, or what distressed companies beg for in order to keep from going bankrupt, which was very close with Opel, and happened with GM.

    This is a simple incentive the likes of which almost all healthy companies avail themselves of in order to do business.

    • 0 avatar
      Lorenzo

      Exactly. The U.K. didn’t actually spend any cash, they just guaranteed a loan that Ford has to pay back. That’s not what GM wanted from Germany.

    • 0 avatar
      Z71_Silvy

      or what distressed companies beg for in order to keep from going bankrupt,

      Oh…like that NINE BILLION Ford had the US Government set aside when Saint Al was begging before congress?

    • 0 avatar
      NulloModo

      I never saw any begging in front of Congress. I saw Al stand beside Chrysler and GM in a show of solidarity between the Detroit automakers. Even afterwards there were plenty of interviews in which Mulally stated that Ford didn’t need any money. Yes, they took an open line of credit, but they never used it.

    • 0 avatar
      Silvy_nonsense

      “Oh…like that NINE BILLION Ford had the US Government set aside when Saint Al was begging before congress?”

      You’re referring to the money that Ford didn’t need and didn’t use, right?

      GM and Chrysler were so pathetic and emasculated in front of Congress, begging for their lives. GM and Chrysler embarrassed the country in front of the entire world.

    • 0 avatar
      Telegraph Road

      Although Mulally requested a $9B line of credit in his congressional appearance in the Fall of 2008, he did not pursue it in his follow-up appearance on Capitol Hill in Winter 2009. The supposed $9B credit line was never appropriated by Congress or allocated from TARP funds.

  • avatar
    gogogodzilla

    How is a loan guarantee considered ‘aid’? Specially since it was open to anyone that would meet the requirements laid out.

  • avatar
    Z71_Silvy

    But don’t be confused…even though the money came from the European Government…Ford didn’t take Government money.

    Yeah…I think that’s how it goes.

    • 0 avatar
      trk2

      Man, your posts always crack me up.

    • 0 avatar
      Silvy_nonsense

      You do understand the difference between a handout and a loan, right?

      The U.S. gave Chrysler and GM money in exchange for majority ownership of the companies, gambling that the government would get its money back in an initial public offering in the future. A risky strategy especially considering the pitiful management and products of both GM and Chrysler.

      Ford just took advantage of a great loan rate that the UK government offered because it knows that it needs to give Ford an incentive to stick around.

      The difference is that GM and Chrysler are a couple of beggars who would have failed miserably without government handouts. Ford didn’t need the loan to survive and would have been fine without it. I’m proud of Ford. They aren’t perfect, but they aren’t spoken of in the same sentence as MCI and Enron, like Chrysler and GM.

    • 0 avatar
      Jimal

      I’m convinced at this point that those who continue to confuse loans and aid are being deliberately obtuse on the issue.

    • 0 avatar
      Z71_Silvy

      Who’s confusing it?

      Whether it be a loan or bailout/hand-out…Government money is Government money.

    • 0 avatar
      holydonut

      Unfortunately I don’t think he’s being obtuse. I think he and others like him are simply refusing to acknowledge important grey areas. It doesn’t help that TTAC’s editors/writers continue to push the concepts of bailout and government incentive as synonyms. Even if they are definitely intelligent enough to know otherwise, they don’t seem to care.

      The world is black and white to their perspective. Their view is that the business should operate without a single bit of government intervention. Any public-sponsored benefit must be a bailout/handout which represents corporate malfeasance.

      If this were the case, I really wish they’d cover the other automakers with equal scrutiny since all large auto firms have taken government “bailouts” in some capacity – ranging from perks to spur hybrid development to tax incentives by purchasing from minority-run suppliers.

      For example, the French government announced they’d buy 50K electric vehicles for use in their government fleet. This is an obvious way to put taxpayer money in the hands of a business that decides to offer an electric vehicle for sale in the French market. But people like Silvy don’t want to treat this with as much scorn and coverage as Ford, even though “government money is government money.” Kind of boggles the mind.

      Do the math assuming that an electric fleet-use vehicle is $25,000 USD (which is a VERY LOW estimate knowing transaction prices of vehicles in the EU). That is $1.25B in guaranteed sales. Every business case out there starts to look pretty good when you have a basis of vehicle sales that is guaranteed.

      I’ll let you decide how much cash revenue and profit margin this could be since everyone here is an expert at that aspect of business planning. On top of this, you would have to know government fleet profit margins – because the margins on government fleets aren’t the same as Hertz/Avis fleets.

      But the kickers are that the French Government decision specifies Renaults and Peugeots. Also, unlike loan guarantees, there is no need to pay this money back, as the French offer is simply a demand-side government incentive.

      Was this given the obligatory TTAC snark? Was this even posted on TTAC? (Hint the answer is “no”). The reason behind this is probably simple. A post about French government decisions lands about 25 hits and doesn’t do much to drive traffic or interest. So wasting time being impartial here doesn’t let them have time to find articles involving Ford.

      http://abccarbon.com/50000-electric-vehicles-france-commits-to-infrastructure-production/

      “Green Technology and Climate Change negotiations, and Christian ESTROSI, Minister for the Industry have signed on 13 April a charter with 12 “pilot” local governments and car manufacturers Renault and Peugeot, committing over the deployment from 2010 of public charging infrastructures for electric and hybrid vehicles.”

    • 0 avatar
      thebeelzebubtrigger

      Jimal:
      “I’m convinced at this point that those who continue to confuse loans and aid are being deliberately obtuse on the issue.”

      Yep. Welcome to the New Paradigm, where trolling is the primary technique of the right wing wackos. From Rush at the top it’s just trolls all the way down. You can’t have reasoned debate with them because there’s no sincerity and no honesty at all in these trolls — it’s like they all took a tip from Wally George.

      I think it spreads due to a form of mass hysteria that has its origins in the inability to face the fall of the American Empire…

    • 0 avatar
      geozinger

      @holydonut: +1.

    • 0 avatar
      Z71_Silvy

      You people want to have an intelligent debate and then in your posts lie and say that myself and TTAC have said and believe things that have never been said or asserted by us.

      Their view is that the business should operate without a single bit of government intervention.

      I have never said or asserted that.

      Any public-sponsored benefit must be a bailout/handout which represents corporate malfeasance.

      I have never said or asserted that.

      But people like Silvy don’t want to treat this with as much scorn and coverage as Ford, even though “government money is government money.”

      You are really reaching. You are asserting that I believe that the Government cannot buy products. NEVER have I asserted such an outrageous claim.

      ————-

      You can’t have reasoned debate with them because there’s no sincerity and no honesty at all in these trolls — it’s like they all took a tip from Wally George.

      And yet you and holy are making things up about my views (with no factual basis). Yeah…that’s honest.

      My objection is to hypocrisy. You can’t go around, thumping your chest saying that we avoided taking Government money…when you are taking Government money.

      Hypocrisy…I’ll give you another example. People who are A-OK with the government buying products (cars in this case) from manufactures and not going on a silly ‘bailout’ tirade…but NOT ok with the government buying a product when that product is 60% of the automaker.

    • 0 avatar
      holydonut

      I take back my comment about Silvy being obtuse. Not only is he obtuse, he’s also a hypocrite.

      He somehow draws a line in the sand that differentiates when the government grants money versus when the government spends money. Apparently it’s up to everyone else to read his mind in an attempt to identify how he differentiates the two verbs.

      The recipient of government money when it is “granted” is taking government money (bad).

      The recipient of government money when it is “spent” is *not* taking government money (tolerable).

      Ford applying for and receiving a loan guarantee represents a government grant. Government tax breaks and other perks extended to automakers not named Ford are examples of Government spending.

      He says calls it absurd to consider a government stop spending on private sector products. I don’t know if he realizes my point is that private companies take government money all the time. It is pointless to differentiate how a private company gets government money. The key is to understand it happens in multiple ways.

      Silvy himself gets to demonstrate the same hypocrisy that he chastises Ford about. Based on his own semantics, he gets to say that receiving government spending is okay but receiving government granting is not okay.

    • 0 avatar
      Z71_Silvy

      You lost all credibility when you started making things up Holy (as I pointed out above).

      Keep on typing your lies and misconceptions…it only hurts you.

  • avatar
    Silvy_nonsense

    Actually, the headline of this article should read “United Kingdom Bribes Ford to Stay in U.K.”

  • avatar
    Telegraph Road

    “Ford has once again snagged aid from a European government”.

    I believe the link you provide has Ford being denied (“Nein!”) by Berlin–not granted approval for–a request of a loan guarantee.

    But you may want to ask Bertel, as he disparages my reading comprehension.

  • avatar
    Steve-O

    Ok, I’m starting to think these types of “Ford/Gov’t Money” posts are simply a ruse to get Z71_Silvy/P71CrownVic to come back to the site…

    • 0 avatar
      James2

      You don’t even need the “Gov’t Money” bit. Hell, the post really doesn’t have to be about Ford, but somehow Z71 will find a way to slag Ford anyway.

    • 0 avatar
      TrailerTrash

      ++++
      Trolling continues on TTAC.

      To not understand the difference of incentives vs bailout is to not understand the difference between low rate student loan vs a grant.

      Cities and states are constantly doing the incentive thing to steal businesses away from other states or even countries. Its success is debatable, but it’s NOT loan
      It’s a nasty way to get jobs into their economies.

      Z71_Silvy/P71CrownVic …good catch, but it has been pointed out be before.

  • avatar

    Good news for the Ford and for the employees who works in the four Ford in UK. By this backing they can develop the technology that will help to build low-carbon emitting cars.

  • avatar
    gimmeamanual

    The EIB is a bank, right? And a loan guarantee is a cosigner, right? How is this Ford getting govenment money? Seems like they’re getting a loan from a bank and the UK is investing (without actually spending) in their domestic manufacturing future.

  • avatar
    wmba

    An item not up to the standard I expect of TTAC.

    A loan guarantee is “aid”.

    And that’s about it.

    The rest of the post is irrelevant.

  • avatar
    jkross22

    Z71’s point is getting a bit lost because he doesn’t like Ford. Still, his point is correct. Governments are deep in the red because of spending way too much. If Ford needs a line of credit, go to a bank. Isn’t that what individuals and companies do?

    If the decision to expand business is based on a taxpayer funded line of credit, then perhaps governments across the board need to rethink this approach. Now, if a state government wants to incentivize a company and get an ROI for that taxpayer investment, great. If indeed that’s the case, lay out the ROI the taxpayers will reap. This is never done. Gee, I wonder why?

  • avatar
    Jimal

    thebeelzebubtrigger
    “I think it spreads due to a form of mass hysteria that has its origins in the inability to face the fall of the American Empire…”

    Yeah, I’m going to go ahead and not agree with your line of thinking either. As the extremes on the left and the right get further to the left and the right, us in the middle seem to be left behind in the process.

    Life is full of shades of grey; extremists on both side of the debate seem to forget that.

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