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Ford didn't take auto bailout money. But Ford supported the car industry bailout.

Ford's new advertising campaign mocks the car-industry bailout:

What the ad conveniently omits is that Ford supported the bailout for its competitors, and sought access to a multibillion-dollar line of credit guaranteed by the government ... you know, just in case. Here are some excerpts from a "Ford Motor Company Business Plan" (PDF) submitted to the Senate Banking Committee in December 2008.

We are acutely aware that our domestic competitors are, by their own reporting, at risk of running out of cash in a matter of weeks or months. Our industry is an interdependent one. We have 80 percent overlap in supplier networks. Nearly 25 percent of Ford’s top dealers also own GM and Chrysler franchises. That is why the collapse of one or both of our domestic competitors would also threaten Ford.

For Ford, the availability of a government line of credit would serve as a critical backstop or safeguard against these conditions as we drive transformational change in our Company. Accordingly, given the significant economic and market risks that exist, Ford respectfully requests that government funding be made available to us, in the form of a “stand-by” line of credit, in the amount of up to $9 billion. This line of credit would be a back-stop to be used only if conditions worsen further and only to the extent needed.

It is in the face of the deepening economic and credit crisis that Ford is asking the Government to make assistance available to the domestic automotive industry even though we have a Plan for our future which, with exception to Department of Energy funding under Section 136, does not assume government assistance. We do so for at least four reasons.

First, we are acutely aware that our supply base, our labor structure, and our dealer network, among other factors, are sized for an industry and a market share that the domestic companies can no longer support. The current crisis has generated considerable debate about the perceived need to restructure our industry in the national interest. As the nation’s oldest automotive company, Ford Motor Company is a vital participant in that debate.

Second, we are aware that our domestic competitors are, by their own reporting, at risk of running out of cash in a matter of weeks or months. Because our industry is an interdependent one, with broad overlap in supplier and dealer networks, the collapse of one or both of our domestic competitors would threaten Ford as well. It is in our own self-interest, as well as the nation’s, to seek support for the industry at a time of great peril to this important manufacturing sector of our economy.

So Ford supported the bailout. It lobbied Congress for the bailout. Why? Because Ford Motor Company wouldn't have survived if the government didn't bail out its competitors!

Now the company is strutting its stuff like it alone embraces free market values—but that's a stance that depends on people forgetting what really happened, and why. And by its own estimate, Ford might not even be around to strut its stuff if the government hadn't intervened. Advertising isn't ever really about the truth, I understand, but this is particularly hypocritical. With this ad, Ford takes advantage of the bailout, twice.

Comments

deregulator said…
The hypocrisy is bothersome, though I'm glad Ford didn't participate. That said, Ford may be in trouble because the bailout included strike protections for GM and Chrysler and Ford may get socked because of it.

http://money.cnn.com/2011/08/02/autos/fords_brilliant_bailout_plan_may_hurt.fortune/index.htm

Another reason to hate unions :-)

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