RSS Report: Book: Ford secretly partnered with Toyota, Honda during economic crisis

[Ringo64]

Filed under: Etc., Government/Legal, Ford, Honda, Toyota, Earnings/FinancialsWhile the headline might seem shocking, given the circumstances of the 2009 global economic meltdown, it only makes sense. Ford's dealings with two of its biggest competitors were centered around mutual self-preservation in the form of trying to keep a beleaguered supplier base afloat, according to The Detroit News. According to the report, Ford, Toyota and Honda cooperated to buy from common suppliers in a bid to keep those parts-makers from going under, which would have threatened the automakers' viability. That revelation comes courtesy of a new book, American Icon: Alan Mulally and the Fight to Save Ford Motor Company by Bryce G. Hoffman.

The auto industry is far more complex than many people realize, especially in this modern era, with ever-more demanding regulations and brutal competition from all corners of the globe. Tier One suppliers, as the biggest parts companies are known, have assumed much of the engineering and product testing and development work for new vehicles, even including big chunks of assembly.

When times get tough, as they most certainly did in late 2008, suppliers are often the canary in the coal mine. At least 27 automotive suppliers filed for Chapter 11 in 2009, meaning that Ford had good reason for taking such precautions, referred to as "Project Quark" internally, according to the report.

Interestingly enough, General Motors and Chrysler, the pair that eventually sought bankruptcy, chose not to participate in the alliance, with GM allegedly expressing concerns over the legality of such a maneuver. The book says Ford's antitrust attorneys were careful to avoid setting foot on the wrong side of such laws, which prohibit collusion on pricing, among other restrictions on cooperative behavior by competitors.

There are quite a few other interesting anecdotes in Hoffman's book, including a heated argument between Mark Fields, Ford's President of the Americas (now said to be in line to succeed CEO Alan Mulally), and Don Leclair, the company's then chief financial officer. According to Automotive News, a passage in the book declares that Leclair suggested that Fields cut the advertising budget for Ford's Bold Moves campaign in 2006. This led to heated argument, that ended up with Fields making a move toward Leclair while spouting some choice four-letter words. The altercation was broken up by none other than Bill Ford Jr.

Book: Ford secretly partnered with Toyota, Honda during economic crisis originally appeared on Autoblog on Fri, 02 Mar 2012 15:29:00 EST. Please see our terms for use of feeds.<h6 style="clear: both; padding: 8px 0 0 0; height: 2px; font-size: 1px; border: 0; margin: 0; padding: 0;"></h6>Permalink | Email this | Comments

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