Ford To Mazda: Sayonara, Bye Bye
End of 2008, Ford was in dire need of cash and decided to sell off a 20 percent chunk of their 33.4 percent holdings in Mazda. Both promised that their cozy relationship would not suffer over something mundane like money. Of course, it wasn’t so. Their relationship disintegrated in record time. And now, they will make it official. Ford Motor Co. has decided to reduce its stake in Mazda by selling a large portion of its remaining shareholdings to Sumitomo group firms and other companies with which Mazda enjoys close business ties, The Nikkei [sub] just learned.
According to The Nikkei, Ford will sell most of their remaining shares, leaving a token presence of 3 percent or less. Once the sale is completed, Ford will no longer be Mazda’s top shareholder.
Mazda has asked Sumitomo Mitsui Banking Corp., as well as Sumitomo Corp. and other major Sumitomo group firms, to take shares off Ford’s hands. Some of Mazda’s parts suppliers will also be asked to help out.
The Nikkei thinks that when all is said and done, each buyer will be allocated around 1 percent of the outstanding shares. Sumitomo Mitsui Banking would end up owning more Mazda shares than Ford. Sumitomo Mitsui Financial already has a 2.9 percent interest.
Once upon a time, Ford sent the people to run Mazda. After they sold their first big batch of shares, their relationship degraded to mere “exchanges of information.” If an executive from Ford wanted to attend a meeting at Mazda, the matters discussed had to be carefully vetted beforehand and signed-off in advance. It’s probably more fun to be deposed by your wife’s lawyer in divorce proceedings.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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I say good riddance (to Ford). Poor innocent Mazda was used, abused, and then tossed aside after Ford got what it wanted. Ford slyly encouraged Mazda to sink its development dollars into new platforms (2, 3, 6, CX-9), then used the fruits of Mazda's labors to develop the Fiesta, V50/EuroFocus/Kuga, Fusion, XC60. What did Mazda get in return? Zero help with advertising and some secret standstill agreement to prevent it from selling the Mazda2 here for 3 years while Ford got its Fiesta act together. Well if Mazda is too incompetent to avoid such unequal treaties perhaps it should just sell itself to Mitsubishi or Suzuki.
Ford's comingling of Mada into their products greatly improved my perception of Ford, beginning in the late 80's with the Tracer, and continuing on through the 90's. The Fords that were re-badged as Mazda's, well, I was less impressed. Personally, I'd like to see the relationship between Ford and Mazda continue. I think the benefits of having the Mazda technical influence, and the Ford scale is a good combination.
Monty is absolutely right. Both got their rewards. Mazda made money, and Ford re-learned how to make a decent product. It will probably be a happy ending for both.
I'll never forget my amazement when I found out that my carpool driver's POS Ford Aerostar 4wd had exactly the same power mirror adjustment controls as my 1984 RX-7. I heard stories over the years that the Ford Probe and RX7 had a lot in common, but never drove a Probe so I don't know if that's true.