Ford considers selling Mazda stake

[Dino Scuderia]

Ford and GM keep saying bankruptcy is not an option....it's damn near mandatory at this point.

TOKYO -- Ford Motor Co. is exploring the sale of its controlling stake in Mazda Motor Co. as part of an effort to shore up the U.S. auto maker's finances amid a downturn in global auto sales and questions about the company's liquidity position, according to a person familiar with the matter.

It was unclear how much of the Dearborn, Mich. company's 33.4% controlling interest in Mazda would be up for grabs, but the person said that Ford is looking at a broad range of asset sales in advance of substantial losses expected to be announced when the auto maker releases its third-quarter results later this month.

A spokesperson for Ford Asia Pacific declined to comment, saying that the company does not talk publicly about possible asset sales.

Mazda said it was not aware of any plans by Ford to sell its stake in the company. "We have not announced anything, and nothing has been decided," Mazda said in a statement. "We have nothing to disclose."

The tie up between the two auto makers dates to 1979, when Ford acquired a 25% stake in Mazda. In 1996, as Mazda foundered in debt amid declining sales, Ford increased its share to 33.4%, giving it effective control of the company under Japanese law.

Mazda and Ford operate a number of joint ventures around the globe, including the Auto Alliance International plant in Flat Rock, Mich., where Mazda produces its Mazda6 sedan and Ford makes the Mustang.

In its current four-year business plan, Mazda had set a goal of deepening its "strong and enduring partnership" with Ford by sharing personnel, platforms, dealership operations, the research and development of hybrid cars and joint manufacturing operations in China and Thailand as well as the U.S.

Since suffering huge losses in 2001, Mazda, Japan's fifth largest auto maker by sales volume, has made a comeback, posting record profits in recent years. Ford, by contrast, has lost $24 billion since 2006. Worries that slumping auto sales around the world and reduced access to credit may mean that auto makers do not have enough cash to survive the economic downturn have hammered shares of Ford and General Motors Corp. this week. People familiar with the matter say that GM has recently been in discussions about acquiring Chrysler LLC, in another dramatic sign of the pressures mounting on the U.S. auto industry to restructure. (See related article).

In an interview Friday, Ford Chief Executive Alan Mulally reiterated that bankruptcy is not an option for the struggling auto maker though there is no clear indication about when it might return to profitability.

Wall Street Journal

[scottie300z]

I'd rather see them sale something else. Mazda has gotten their stuff together and while that means they may get a good price if I were them I'd rather keep it.

[NSXType-R]

If selling Mazda means that Mazda can be independent again, I'm all for it. That means that we can see the return of the RX-7, maybe even to racing again.

The only issue is, it will only hurt Ford. Ford has never pulled a profit, but Mazda has. How will it benefit Ford?

I don't give a crap about Ford, but this can only be a bad decision, for the survival of Ford.

[f6fhellcat13]

If selling Mazda means that Mazda can be independent again, I'm all for it. That means that we can see the return of the RX-7, maybe even to racing again.

The only issue is, it will only hurt Ford. Ford has never pulled a profit, but Mazda has. How will it benefit Ford?

I don't give a crap about Ford, but this can only be a bad decision, for the survival of Ford.

I doubt this will help Ford, Mazda makes money so Ford makes money (not enough to keep them out of the sh*thole) but selling Mazda will hurt even more in the long run.

[Ferrer]

If selling Mazda means that Mazda can be independent again, I'm all for it. That means that we can see the return of the RX-7, maybe even to racing again.

The only issue is, it will only hurt Ford. Ford has never pulled a profit, but Mazda has. How will it benefit Ford?

I don't give a crap about Ford, but this can only be a bad decision, for the survival of Ford.

Well they owned only 33% of Mazda so I doubt the Ford sale would affect much their "independence".

However I wonder how that could affect all the technology both companies share currently.

EDIT Having read the first post they would regain independence.

[NSXType-R]

Well they owned only 33% of Mazda so I doubt the Ford sale would affect much their "independence".

However I wonder how that could affect all the technology both companies share currently.

EDIT Having read the first post they would regain independence.

Well for one thing, they won't be sharing platforms anymore. Does Ford still own Volvo?

[f6fhellcat13]

Well for one thing, they won't be sharing platforms anymore. Does Ford still own Volvo?

Yes, but they want to sell them.

[cmcpokey]

i cant decide how into this i am. as much as im not really into ford owning mazda, they do have a lot of resources that mazda uses. since i own 2 of them, i like mazda having as many resources as possible.

and mazda has had a lot of freedom to decide their own fate in the last few years, so i dont think it will really free up their idea pool.

[digitalcraft]

If Ford sells anything, it won't be their stake in Mazda.

[LeonOfTheDead]

since the situation is very bas since so many years, I wouldn't be surprised if Ford ended up selling both Mazda and Volvo. they desperately need money. soon.

[092326001]

ford seems to be trying awfully hard to get rid of all assets that may earn them future profit

[cmcpokey]

ford seems to be trying awfully hard to get rid of all assets that may earn them future profit

thats true, but to get rid of the money losing brands, ford woudl have to sell... well, ford. (lincoln and mercury too.)

so woudl the answer be to stop making all cars in the US with the exception of the trucks, since they make money. just concentrate on their overseas interests.

if they did that, then imported the euro fords, i may be interested in a ford.

[h22a]

dont know about mazda but volvo has been a huge money maker for ford in recent years. it would be very sloppy if they sold off volvo....when i finished up with volvo 6 month ago volvo had about a 33% increase every year in sales since 2003 placing them
5th in the prestige market.

[scottie300z]

thats true, but to get rid of the money losing brands, ford woudl have to sell... well, ford. (lincoln and mercury too.)

so woudl the answer be to stop making all cars in the US with the exception of the trucks, since they make money. just concentrate on their overseas interests.

if they did that, then imported the euro fords, i may be interested in a ford.

I agree. They think they know what they're doing by giving the US cars made specifically for the market but they apparently aren't good at knowing the market. The mondeo and the new fiesta over here would be nice, w/o them lifting a finger.

Lincoln and mercury need complete overhauls in my opinion. Mercury may not be needed and lincoln needs to look at cadillac

[digitalcraft]

There was a time when they could have made mercury successful because it was sort of the sports version of ford, but they absolute killed it with things like the sable.

Honestly, the sable isn't a horrible car, but its like Lamborghini coming out with a four-door or something... oh wait. How about Porsche... no that's not it. Anyways, you get the idea, if you're going to build a brand image, you should stick to that image and not put cars in it that directly compete against your main brand in the extremely short-sighted notion the sporty brand might make that car sell better.