Ford Hopes To Snatch Opportunity From Crisis

The government is forcing General Motors and Chrysler to dramatically restructure their businesses or face a bankruptcy judge.

But Ford is a different story.

Unlike its Detroit rivals, Ford is not beholden to Washington. Company officials hope that fact — and some new products — will give Ford a competitive edge in the future.

The collapse in auto sales has clobbered all car companies, but for those that are relatively strong, the recession may be an opportunity.

Crisis Creates Opportunity

Mark Truby, head of Ford's corporate communications, said the crisis is a chance to show that Ford isn't like its competitors.

"We want everybody to be clear about where we are in terms of the government funding," Truby said.

In other words: Ford hasn't taken a dime from Washington — at least, not yet. GM and Chrysler already owe the government more than $17 billion.

Ford is also unveiling more fuel-efficient models –- including the new Fusion Hybrid, a midsize sedan.

Truby said he hopes that by putting out competitive products — without the help of taxpayer loans — Ford will win over more consumers.

"We think it's important for customers to know we're still going to be there," he said. "We're not going anywhere. We're committed to being one of the survivors of this downturn."

But does that sort of pitch resonate in showrooms? Several dealers said sales for all three carmakers are so bad, they don't see much difference.

Customers Take Note

But some customers are paying attention.

Carl Schartner recently went shopping at Springfield Ford Lincoln-Mercury in suburban Philadelphia. He traded in his Chevy Equinox for a new Ford Escape.

Schartner, 70, said one reason he bought a Ford was because the company hadn't taken taxpayer money and seemed more secure.

"Ford is not in the bailout," he said. "So, I just thought Ford has its feet on the ground better."

A retired technical support worker, Schartner said the Escape may be his last vehicle, and he wants to make sure the company will be around if it should develop a problem.

"Ford is going to be around for a while for parts," he said. "The others, I don't know how the service would be if they went out (of business) and somebody else took over. Would they or would they not recognize warranties?"

Ford Searches Increase

In fact, the government said it will stand behind Chrysler and GM warranties. But the future of the companies is uncertain, and that can spook customers.

For instance, sales generally rise in the spring, but Ford's sales last month picked up considerably more than GM's and Chrysler's, according to Jessica Caldwell, an analyst with Edmunds.com, the consumer car Web site.

Caldwell also said more people are looking at Ford products on the Edmunds Web site, while fewer are looking at GM and Chrysler vehicles.

"I think Ford has done a good job of trying to distance itself as much as it could from the other two automakers," Caldwell said.

But she said that the strategy could boomerang. Nationally, car sales remain low, and last year, Ford lost more than $14 billion.

"The pitfall is if Ford has to ask for government aid, then I think all that is for nothing — and they have, perhaps, set themselves up for a bigger fall," Caldwell said.

Ford Borrowed Early

Truby downplayed the risk. He said the most important thing is that Ford is in a stronger position than GM and Chrysler, and many analysts agree.

People who follow the industry said Ford is further along in its turnaround and has more cash. That's not because it's making lots of money, but because it borrowed billions of dollars several years ago.

"We went out in 2006, and we essentially raised the money when the capital markets were still functioning normally, and that has helped us get through this downturn," Truby said.

In fact, Ford mortgaged the company, all the way down to its blue oval logo.

"At the time, people said 'Maybe you went a bit too far, that seems risky; that seems desperate,' " Truby recalled.

But now it seems to be the company's saving grace.

Because Ford borrowed early, it has more money to weather the worst car market in more than two decades and — perhaps — come out of it in better shape than its rivals.

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