Ford CEO Mulally: We're In Better Shape Than GM, Chrysler
It's not quite guilt by association, but it's close. Ford, by virtue of being one of the Big 3 and because its finances are weakened, has been lumped in with General Motors and Chrysler as an auto maker needing a bailout. Somewhere in Dearborn, Michigan Ford CEO Alan Mulally is doing a slow burn.
Mulally will tell you, Congress, and his employees that Ford is NOT in the same leaky boat as GM and Chrysler. In fact, when Mulally talks about Ford requesting federal aid he calls it a low interest line of credit, not a bailout. While I don't agree with everything Mulally says (they are in the same boat), I can see exactly why he feels the way he does.
Ford's liquidity is far better than GM's and Chrysler's. It's not on the verge of bankruptcy, but it's not far. If GM goes chapter 11, it may not be long until it drags Ford with it.
So why is Mulally on Capitol Hill requesting a bailout from Congress? Because it's the smart move. First, if $25 Billion can keep GM and Chrysler afloat, that's good news for Ford. Second, if the day comes in 9-12 months where Fords finances slump to the point where it needs a "low interest federal loan", Mulally will have billions in his hip pocket.
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In the meantime, Ford is trying to remind the public that it is in a different spot than its fellow Detroit auto makers. The new marketing campaign is called "Employee Pricing Plus." The ads say the plus stands for the fact Ford's quality is higher than competitors, so buyers can have peace of mind they are getting a decent vehicle at a decent price. It's subtle. It may not have much impact. It is so Ford right now.
Knowing Mulally as I do, I'm sure he's watching this whole process play out and is relatively calm about where Ford stands. Yes, it is serious. Yes, it could ultimately take Ford down. Still, Mulally and Ford will tell you, their situation is different.
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