Mazda may buy some of itself back from Ford
Rumors of Ford selling part or all of its 33.4% share in Mazda have picked up steam this week since we first reported on them over the weekend, and analysts in Tokyo think a deal that "clears a cloud over Mazda" is imminent. Nikkei English News also reported that Ford has asked Japanese supplier Denso to purchase part of its stake in Mazda, but the Japanese news agency didn't claim any sources and Denso has declined comment in the matter. Most are guessing that potential buyers would include Mazda itself, as well as a number of companies over which the risk of investment could be spread, while Ford would likely hold on to at least some of its stake in the brand but lose its controlling share of the company. Management from Ford and Mazda are largely silent regarding any possible deal, but Mazda spokesman Ken Haruki said that "nothing has been decided," which doesn't sound like much of a denial. There is no question that Ford needs cash to get through these turbulent economic times, and its share of Mazda is currently worth $1.33 billion based on Wednesday's share price, which itself has dropped 56% in the past year. The ownership status of Mazda is likely worth more than $1.33 billion, though, and anyone taking that title from Ford will surely have to pay a premium.
Even if Ford sells some or all of its stake in Mazda, the two companies would continue to share platforms, powertrains and components for a long, long time. That will help Ford continue to enjoy economies of scale while giving Mazda good hardware without the massive development costs.
[Source: Detroit News]












Reader Comments (Page 1 of 2)
Richard S. 10:16AM (10/16/2008)
Maybe Toyota would like to buy Ford's stake in Mazda. That would continue Toyota's path of world domination, especially in the JDM: They own/control, Daihatsu, Hino and Subaru. They could buy Isuzu and Mazda as well.
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Kitko 10:31AM (10/16/2008)
Giving Mazda good hardware? From Ford? Euro Focus platform is more Mazda/Volvo development than Ford's, pretty much all i4 Duratec engines in Ford's cars are rebadged Mazda's MZR powertrains. Focus 5cylinder is based on Volvo engine. Isn't it US Fusion that's based on Mazda 6?
In terms of technology and hardware and development, it was Ford that was dependent on Mazda. Not vice versa.
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Hamud 10:54AM (10/16/2008)
It doesn't mean that Ford didn't help to develop these technologies and hardware.
Luis 2:16PM (10/16/2008)
I agree with Hamud. Mazda develops with Ford backing. I don't think Ford will pull out completely, it's in both companies' best interest to continue sharing input.
-blank- 2:17PM (10/16/2008)
hardware...ie control arms, frames, etc.
these cost to manufacture but in effort to save $ ford does the manufacturing of them internally/vendors/whatever for mazda/volvo while being allowed to use their designs and mazda/volvo gets the manufactured design.
so they aren't giving good design, just good hardware from their design.
adrian 2:49PM (10/18/2008)
That's what happends when you pump money into another company and gain a large stake. You then exercise your right to use their technology.
Flashpoint 10:33AM (10/16/2008)
I've studied the Great Depression in history classes.
I had no idea I'd actually be living it and watching America's financial institutions unravel.
I'd just like to thank Bush, Cheney, the neocons, Paulson, Bernake, Greenspan, the Federal Reserve, Wolfowitz, Rumsfeld and every one else on the list of people set to burn in the hottest corners of hell for eternity.
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Frank 10:45AM (10/16/2008)
If you want rehash political crap, take it somewhere else. We're talking about Mazda and Ford here. May I suggest a good psychiratrist for your BDS?
Ok... back to the subject at hand. Ford will continue to use Mazda tech. It won't change the relationship between companies. But the sale of stock will give Ford something it needs - capital.
Gabagool 10:55AM (10/16/2008)
Why use Mazda tech?
Look Daewoo builds cars for GM, the only difference between Daewoo and Chevy and Pontiac is the badge.
Why not do the same with Mazda, only thing is Mazda make great cars. So if Mazda could design, develop and build a new Focus sized car, that would solve all Fords problems.
In other words picture this, if the new Mazda 3 was simply sold as a Focus, that car would be a huge hit. But the key is that Mazda needs to build that car with ZERO input from Ford.
Tagg 11:29AM (10/16/2008)
What does this have to do with Mazda? I think you you typed in the wrong address into your browser bar.
Yep, everything is Bush's fault and Obama will fix all that is wrong in the world. Yeah, right.
Rocketboy 11:23AM (10/16/2008)
Well, they back to school for you, because you didn't get any of the historical context of the Great Depression. Nor do you have any idea of the context of what's going on now.
That, and you are a troll. Go away little boy.
Billybob T 11:39AM (10/16/2008)
Blame Bill Clinton, Barney Frank, and Chris Dodd. Liberal idiot.
John B 3:24PM (10/16/2008)
"I've studied the Great Depression in history classes."
Then you must have read about Roosevelt's address to the nation on television - the one Joe Biden talked about.
Gabagool 11:49AM (10/16/2008)
@ Billy bob, i see your point about Barney and Dodd, but come on already, Bill Clinton did an excellent job, especially if you compare his 8 years head to head with someone else's 8 years (let's not name any names)
btw i am a Republican.
Big Rocket 8:19PM (10/16/2008)
@Flashpoint, and anyone else who wants to blame just one party or the other for the economic crisis:
FactCheck.org:
There's plenty of blame to go around, and it doesn't fasten only on one party or even mainly on what Washington did or didn't do. As The Economist magazine noted recently, the problem is one of "layered irresponsibility ... with hard-working homeowners and billionaire villains each playing a role." Here's a partial list of those alleged to be at fault:
• The Federal Reserve, which slashed interest rates after the dot-com bubble burst, making credit cheap.
• Home buyers, who took advantage of easy credit to bid up the prices of homes excessively.
• Congress, which continues to support a mortgage tax deduction that gives consumers a tax incentive to buy more expensive houses.
• Real estate agents, most of whom work for the sellers rather than the buyers and who earned higher commissions from selling more expensive homes.
• The Clinton administration, which pushed for less stringent credit and downpayment requirements for working- and middle-class families.
• Mortgage brokers, who offered less-credit-worthy home buyers subprime, adjustable rate loans with low initial payments, but exploding interest rates.
• Former Federal Reserve chairman Alan Greenspan, who in 2004, near the peak of the housing bubble, encouraged Americans to take out adjustable rate mortgages.
• Wall Street firms, who paid too little attention to the quality of the risky loans that they bundled into Mortgage Backed Securities (MBS), and issued bonds using those securities as collateral.
• The Bush administration, which failed to provide needed government oversight of the increasingly dicey mortgage-backed securities market.
• An obscure accounting rule called mark-to-market, which can have the paradoxical result of making assets be worth less on paper than they are in reality during times of panic.
• Collective delusion, or a belief on the part of all parties that home prices would keep rising forever, no matter how high or how fast they had already gone up.
The U.S. economy is enormously complicated. Screwing it up takes a great deal of cooperation.
Quoted article at:
http://www.factcheck.org/elections-2008/who_caused_the_economic_crisis.html
jamie 10:53AM (10/16/2008)
How sweet it is!
I posted this story in one of my replies on Autoblog TWO DAYS AGO! Check the Mercury entry again.
I guess Autoblog finally read it or waited until their sources caught up with the story. I usually give Autoblog these tips, but they have been reluctant to acknowledge the fact, so I have stopped doing so, and will post my findings inside my replies from now on. Read it here first, from me of course! LOL
Someone actually blasted me for spreading rumors about Mazda, so I had to set the record straight. Nice to see Autoblog catching up with me though.
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anoldbikeguy 11:05AM (10/16/2008)
I have a hard time believing that Ford would ask Denso to purchase some or all of its stake in Mazda - Denso is a Toyota Kaisan, and is partially owned by Toyota. Not that Denso does not supply to Ford - instrument clusters and HVAC controls are sold by Denso to all of the domestic OEMs.
Ford already had issues with another Toyota Kaisan - a couple years ago when the Ford Escape hybrid was introduced there was
a 'supplier issue' with some of the components resulting is a shortage - amazingly enough the same supplier was able to supply Toyota's needs without any problems!
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Tagg 11:30AM (10/16/2008)
I'm not sure what purpose Mazda serves for Ford. People will say "but they get everything from Mazda" but then in another post talk about how bad the product from Ford is. With Ford moving to their "one Ford" strategy Ford NA will be relying on Europe more for product technolgy, little of which comes from Mazda.
In my opinion they should just sell it all (maybe keep a small stake), take the money and run
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Travis 2:36PM (10/16/2008)
Ford Europe uses more Mazda tech, most of the good cars, are largely Mazda, the good Ford Focus the one in Europe is based on the C1 platform that was largely developed by .... Mazda and to some extent Volvo, You can see the C1 in the US in the form of the Mazda 3. The Ford Festiva is pretty much a badge job on the Mazda 2, Ford Kuga, based on a modified version of the C1 platform used in the Focus, The Mondeo is based off a Volvo Platform known as EUCD which was ... based on the C1 platform. All the Euro only Fords that people want in the US seem to have a lot of input from Mazda, ... well ok the Ford Ka is actually a Fiat.
-blank- 2:33PM (10/16/2008)
if i'm not mistaken, i believe even euro ford's use mazda/volvo designs. ie. drivetrains, (some) engines, and other various parts. Essentially, if true they'd still need them
As for the first portion of your comment, they don't get everything from Mazda/volvo. Ford likes to tinker a bit and try making their own thing. That sometimes ends with less then stellar results. Chances are ford goes "i like that, but i also want to add this and maybe this. also, could we cut costs a little somehow?"
Plus, it's not that the cars themselves are bad but that once they make it through fords hands they cheapened up the interior and sloppied up the exterior to what they think American's really want.
One could argue that they do a good job of it because they sell more then mazda or volvo's versions of the same drive train and I won't argue with that but that just never computes in my head. There's rarely a Ford outside & inside I actually can tolerate for longer then a test drive. To each his/her own though.