Ford and General Motors

Engaging reverse gear

Aug 24th 2006
From The Economist print edition

Ford's big cutbacks are the latest sign of deeper problems

FORD'S announcement on August 18th of a 21% cut in its planned output in the fourth quarter of the year shows what an increasingly desperate situation it is in. The world's third-largest carmaker has been trying to cut its way to profit for four years, with little success. In the first half of this year it slipped back into a loss of $1.3 billion, after three years of recovery. The only positive thing about its latest announcement is that it shows the firm is at last beginning to face reality. Indeed, in the longer term, there are signs that the company and the Ford family are considering even more drastic action

The reason for the cutback is that Ford is being hit hard by the fall in sales of big pick-up trucks and SUVs, where it makes most of its profits. With the high cost of petrol, consumers are moving down to smaller SUVs or even to cars, both parts of the market where Ford is not so strong. In the past, Ford's reaction to a downturn would have been to use big discounts to “move the metal”. But that is a horribly expensive way to protect market share, and one that Ford can no longer afford. So it has decided instead to retreat by cutting production. (It will also offer interest-free loans on sales of surplus cars that have already been built.)

Ever since it plunged suddenly to a $5.5 billion loss in 2001, Ford has issued a series of recovery plans based on factory closures and job cuts that take forever to have any effect, because the United Auto Workers union has to agree to them. Meanwhile, Ford's share of the North American market has steadily declined.

The firm is now planning further job cuts on top of those in its “Way Forward” plan unveiled last January. That called for 30,000 jobs to go, with the closure of 14 plants. Way Forward was itself a response to the failure of the 2002 recovery plan put in place when Bill Ford took over as chief executive from Jac Nasser. The board will meet next month to consider further drastic cuts of about 25% of jobs, including salaried staff. So 30,000 employees could be offered severance packages before the planned plant closures even take effect. Ford looks, in other words, as though it is now trying to emulate the cuts under way at General Motors (GM).

For months attention has focused on the travails of GM, as it grappled with losses, overcapacity, job cuts and huge liabilities for pensions and health care. Now the world's biggest carmaker—still just ahead of Toyota—is doing better. It managed to make a profit in the first half of the year (excluding one-off charges), is quietly cutting back on profit-sapping discounts and has persuaded a third of its workforce to accept early severance. It is also contemplating a tie-up with Renault and Nissan.

Late last year Ford family members were talking wistfully of taking the company private. But they could not afford the $15 billion that would have cost, and no private-equity backer would go near a firm with such poor prospects where a family holds 40% of the voting shares, but only 5% of total equity. Now in a clear sign that the family is worried, a veteran investment banker who used to work for Goldman Sachs has been appointed to carry out a strategic review of its assets for Bill Ford.

He may come under pressure from directors to sell bits of the company. One obvious candidate is Volvo, which is doing well. And JCB, a British construction-machinery group, says it is interested in buying Jaguar, the loss-making British carmaker which has cost Ford $10 billion since it was bought in 1989. Carlos Ghosn, who runs Renault and Nissan, has looked at Jaguar too. And there were even suggestions this week that Ford has proposed itself as a better American partner than GM for Renault and Nissan.

It all shows how bad things have become. Insiders acknowledge that Ford's main weakness is poor product development. This has left it struggling in its highly competitive home market, where it faces not just GM and Chrysler, but also Japan's big three (Toyota, Nissan and Honda) and Hyundai, an ambitious South Korean newcomer. Though Ford does well with some models such as the Mustang sports car, it is weak in minivans and the smaller saloons that are coming back into fashion. Successive reorganisations have wrecked Ford's product development. Even if it were working well, the company takes three to four years to turn out a completely new model. No wonder the family is getting twitchy: things could get much worse before they get better

Ford and General Motors

Engaging reverse gear拉动倒档

Aug 24th 2006
From The Economist print edition

Ford's big cutbacks are the latest sign of deeper problems福特的大规模减产是其更深层次问题的最新征兆

FORD'S announcement on August 18th of a 21% cut in its planned output in the fourth quarter of the year shows what an increasingly desperate situation it is in. The world's third-largest carmaker has been trying to cut its way to profit for four years, with little success. In the first half of this year it slipped back into a loss of $1.3 billion, after three years of recovery. The only positive thing about its latest announcement is that it shows the firm is at last beginning to face reality. Indeed, in the longer term, there are signs that the company and the Ford family are considering even more drastic action.

福特公司于8月18日宣布，将削减第四季度21％的计划产量，这无疑说明了公司正在陷入更深的困境之中。作为全球第三的汽车制造商，福特连续四年尝试通过削减的方式获得盈利，然而收效甚微。在三年的复苏之后，今年上半年福特遭受了13亿美元的巨大损失，再次跌入深渊。唯一值得肯定的是，此次宣告表明公司最终选择了面对现实。事实上，从长远的角度看，公司以及福特家族正在酝酿更为惊人的举措。

The reason for the cutback is that Ford is being hit hard by the fall in sales of big pick-up trucks and SUVs, where it makes most of its profits. With the high cost of petrol, consumers are moving down to smaller SUVs or even to cars, both parts of the market where Ford is not so strong. In the past, Ford's reaction to a downturn would have been to use big discounts to “move the metal”. But that is a horribly expensive way to protect market share, and one that Ford can no longer afford. So it has decided instead to retreat by cutting production. (It will also offer interest-free loans on sales of surplus cars that have already been built.)

此次削减的主要原因是，作为利润最高的大皮卡车和运动型多功能车的销量锐减致使福特遭受了重撞。由于高额的汽油价，消费者倾向于购买小号的运动型多功能车或小轿车，而在这些领域福特并不擅长。过去，面对颓势，福特的对策是通过大打折扣将“金属移出”。但是以这样的方式来保护市场份额的确非常昂贵，福特能够承受这种方式的日子也是一去不再回。所以，现在公司只有被迫采取削减产量来代而替之。（对于已生产的多余车辆，公司也提供零利率贷款的支付方式。）

Ever since it plunged suddenly to a $5.5 billion loss in 2001, Ford has issued a series of recovery plans based on factory closures and job cuts that take forever to have any effect, because the United Auto Workers union has to agree to them. Meanwhile, Ford's share of the North American market has steadily declined.

自从2001年顷刻间遭遇了55亿美元的暴跌，福特颁布了一系列依靠关闭工厂与裁减员工的复苏方案，但是根本没有作用，因为美国汽车工人联合会也是迫于无奈才予以批准。同时，福特在北美市场的份额也缓慢下跌。

The firm is now planning further job cuts on top of those in its “Way Forward” plan unveiled last January. That called for 30,000 jobs to go, with the closure of 14 plants. Way Forward was itself a response to the failure of the 2002 recovery plan put in place when Bill Ford took over as chief executive from Jac Nasser. The board will meet next month to consider further drastic cuts of about 25% of jobs, including salaried staff. So 30,000 employees could be offered severance packages before the planned plant closures even take effect. Ford looks, in other words, as though it is now trying to emulate the cuts under way at General Motors (GM).

在去年一月发表的“前进之路”计划中首当其冲的就是现在公司正在酝酿的进一步裁员。声称将削减30000员工，并关闭14间工厂。前进之路计划本身是比尔﹒福特接替雅克﹒纳撒尔出任首席执政官后面对2002复苏计划失败而采取的对策。董事会将于下月讨论进一步采取更猛烈的削减，预计大约有25％的职位，包括高薪职员。因此在计划中的工厂关闭之前，30000名员工可以享受一次性买断。换句话说，福特看起来就像在比照通用的方式一样进行削减。

For months attention has focused on the travails of GM, as it grappled with losses, overcapacity, job cuts and huge liabilities for pensions and health care. Now the world's biggest carmaker—still just ahead of Toyota—is doing better. It managed to make a profit in the first half of the year (excluding one-off charges), is quietly cutting back on profit-sapping discounts and has persuaded a third of its workforce to accept early severance. It is also contemplating a tie-up with Renault and Nissan.

数月来，苦苦挣扎的通用一直是关注的焦点，它始终与巨额损失，过量生产，员工裁减以及在养老和医疗津贴方面的庞大债务进行顽强的抗争。这家仅领先于丰田的全球第一汽车制造商，现在的境况有所好转。它已经成功地在上半年中盈利(一次性费用除外)，这使其在无形中缩减了减利的折扣并规劝其三成的员工接受一次性买断。公司还期望与雷诺－日产结为盟友。

Late last year Ford family members were talking wistfully of taking the company private. But they could not afford the $15 billion that would have cost, and no private-equity backer would go near a firm with such poor prospects where a family holds 40% of the voting shares, but only 5% of total equity. Now in a clear sign that the family is worried, a veteran investment banker who used to work for Goldman Sachs has been appointed to carry out a strategic review of its assets for Bill Ford.

去年年底，福特的家族在讨论中流露中渴望将公司收入自己囊中的意向。但是如果这样，他们将消耗150亿美元的费用，这是其无法承受的，而且，由私人资产支持的个体没有愿意与一家由家族占40％决议权，5％股份的前景黯淡的公司合作。目前有明显的迹象表明家族成员的担心，一位曾在高盛工作的资深投资银行专家被任命对比尔﹒福特的资产进行战略性评估。

He may come under pressure from directors to sell bits of the company. One obvious candidate is Volvo, which is doing well. And JCB, a British construction-machinery group, says it is interested in buying Jaguar, the loss-making British carmaker which has cost Ford $10 billion since it was bought in 1989. Carlos Ghosn, who runs Renault and Nissan, has looked at Jaguar too. And there were even suggestions this week that Ford has proposed itself as a better American partner than GM for Renault and Nissan.

在董事会的重压之下，他有可能出售旗下的部分公司。其中最为积极相应的运作良好的沃尔沃。另外英国一家建筑机械制造商JCB有意收购捷豹，英国的汽车制造商捷豹自1989年被福特招致麾下以来，基本没有带来任何利润而损耗了100亿美元的资金投入。另外，雷诺－日产的卡洛斯﹒戈恩对捷豹也是虎视眈眈。甚至有迹象证明，福特认为自己比通用更适合作为雷诺－日产在美国的合作伙伴。

It all shows how bad things have become. Insiders acknowledge that Ford's main weakness is poor product development. This has left it struggling in its highly competitive home market, where it faces not just GM and Chrysler, but also Japan's big three (Toyota, Nissan and Honda) and Hyundai, an ambitious South Korean newcomer. Though Ford does well with some models such as the Mustang sports car, it is weak in minivans and the smaller saloons that are coming back into fashion. Successive reorganisations have wrecked Ford's product development. Even if it were working well, the company takes three to four years to turn out a completely new model. No wonder the family is getting twitchy: things could get much worse before they get better.

所有这些展现出了困境在是怎样变化。知情人士承认福特的主要弱点在于发展低成本产品。这逼得福特卷入激烈的市场竞争中，其对手不仅是通用和克莱斯勒，而且包括日本三强（丰田，日产和本田）以及雄心勃勃的现代，来自韩国的汽车新生军。尽管，福特在运动汽车野马运作良好，而在如今重新流行起来的迷你型和小型轿车方面却是其软肋。连续的重组削弱了福特的产品发展。即使成功运作，公司也需要三到四年推出一种全新的款式。难怪现在福特家族如坐针毡：泰来之前惟恐否极。

Insiders acknowledge that Ford's main weakness
   

[+] main strength 主要优点