Rumor gone Wild: "Toyota is buying Ford?"

[Ming]

Hey, did you hear the one about Ford and Toyota? No way
Internet rumors breed angst, PR headaches
By Daniel Howes
The Detroit News

Today’s the day Toyota Motor Co.p. is supposed to announce plans to buy Ford Motor Co.

Or buy 20 percent of Ford.

Or buy Ford of Europe.

Or buy Ford’s Wixom Assembly plant.

Or take a 45 percent stake in Visteon, Ford’s once-and-former supplier.



But none of these are true, both companies say emphatically. Like the Orson Welles-concocted “War of the Worlds” radio broadcast that panicked a nation, the Internet-fueled Toyota takeover rumor mill has rattled many who care about Ford, the auto industry and the future of Detroit.

From assembly line hands and white-collar engineers to Ford retirees and big-time auto dealers, the back channels are buzzing with, “Have you heard ...?”

Maybe it’s all this recent talk about Toyota looking for land to expand its technical center in Washtenaw County. Or that Gov. Jennifer Granholm is pushing the Legislature to make sure Toyota gets the land it wants, so she can claim credit for landing hundreds of next-century auto jobs.

Or maybe the metastasizing rumors are evidence of Detroit’s anxiety about a creeping foreign domination of its hometown industry. Combine that with too many people with too much time using the power and pervasiveness of the Internet to spout off and what you get is a lot of half-cocked blather that doesn’t pass the “does-it-make-sense” test.

Ford says — repeatedly, but not for attribution, because it doesn’t want to acknowledge the rumors by responding to them — that there’s nothing to any of this. Yet the rumors grew so intense as the week passed that by Wednesday the company published a story on its internal Web site headlined, “Growing Use of Internet Publishing Brings New Challenges to Business.”

“Thanks — and sometimes, no thanks — to the Internet, everyone’s a publisher now,” the internal article said. “And that’s creating new challenges for companies like Ford, political campaigns and anyone else in the public eye.

“The disadvantage of the Internet is that rumors can be published electronically that don’t pass anyone’s journalistic standard. Such rumors can proliferate rapidly and create headaches for those who are charged with managing the news.”

Ford should know, given the cultural propensity of some inside for trafficking in farfetched rumors when their time would be better spent focusing on building better cars and trucks.

Toyota dismisses the takeover talk with a generic strategy statement and a hint of bemusement. Japan’s No. 1 automaker has no intention “to acquire another auto company,” according to a Toyota spokesman in New York. “Our intention is to work from the ground up.”

Toyota doesn’t buy old auto plants in the UAW stronghold of Metro Detroit. It builds new, state-of-the-art plants in the fields of Indiana, the valleys of West Virginia and the arid hills outside San Antonio. And it recruits new, younger workforces untainted by the old habits of the UAW.

Toyota has made, oh, about $18 billion in net profits over just the past two years (roughly 80 percent of it from American wallets). Its market share is growing in the rich U.S. market, growing in Europe and playing catch-up, Toyota-style, in China. What would it gain by owning any piece of Ford, aside from a furious political backlash and the mother of all culture clashes?

Full Article Here

[gmwsag]

Oh come on.
I don't mean to laugh, but I can't help it. I mean, Toyota buying Ford???? In anyway, Ford would reject. They rejected the time The General offered to buy them, and they will most likely reject this time. I was so surprised when Chrysler was bought out by Benz. That was the first clue telling me hey, guess what: The Americans will shoot out of the market if they don't buck up, and come up with good cars.

[ByTheLake]

Well, the rumors make no business sense. With Toyota's sales momentum and extremely low number of retirees on its pensions, why would it want to change both by acquiring an American assembler?

Given the stock prices, Toyota could pay cash for GM, too, but that's the last thing it wants to do.

[awalbert88]

Ford isn't exactly for sale, and even if it was, Toyota wouldn't want to buy it. Toyota has no desire to purchase another automaker, and for good reason. If there are any big shake-ups, it would likely be an acquisition of Volkswagen by either GM or Ford. Only GM and Toyota really have the money available to buy out VW, though there has long been talk of Ford doing it. I can't imagine why Ford would, though. GM has a habit of acquiring more brands than it needs so it can leverage a locally popular name. Beyond that, I see little business sense in such a monstrous purchase. Peugot/Citroen is the only other big company that comes to mind as a possible acquisition by any of the other big players.

Ford has probably made the best use of the various buy-outs and partnerships during the boom days of the 90's, though. They've nicely integrated the outstanding platforms that Mazda and Volvo developed into their entire global product line, which is a contributing factor to Ford having improved profitability so much.

These rumours really got their start when Toyota got within spitting distance of Ford for overall sales. And just like now, they had no basis in reality.

[The Oatman]

I don't know... every time I see the Toyota CEO in pictures he has this sinister laugh going on. Maybe hes laughing at how most of the competition is fumbling about.

[LINCSAT]

The first poster just happened to leave out of what he typed that ford has 26billion in the bank. This sounds very anti-american and as a new person coming to north america this story is very sick and stupid. I would think toyota is very upset with this stunt because it will cause some hatred towards toyota and it's workers, ford I would say will also feel some backlash and cause customer awarness concerns at dealers at both compaines. As a foriegner when general motors, ford and the german-american dcx bought or control most of the japanese car compaines except honda and toyota, a worker I work with who is american made a comment that oh well now I have to get rid of my wrx it's gm now. It looks like some posters are disgusted with this poster and I don't blame them and I am sure there will be more.

[Rex Raider]

Honda is marrying J.Lo.

[Hudson]

Why is EVERYONE on this thread in agreement with my thoughts? That's so unlike this site.

Toyota wouldn't buy any part of Ford that would require them to take on UAW membership (20% of Ford or buying Wixom). And Ford wouldn't give up Ford of Europe (and admit defeat?).

Toyota doesn't typically grow by acquisition. They've taken over most of Daihatsu and Hino, but they tapped into them decades ago. And Ford offers them what?

The difference between Chrysler being taken over by Daimler-Benz and Ford being taken over by anyone (GM, Toyota, Wal-Mart....) is that nobody owned a substantial stake in Chrysler but the Ford family owns 40% of Ford.

[tgagneguam]

Originally posted by awalbert88@Sep 5 2004, 01:54 AM
...Ford has probably made the best use of the various buy-outs and partnerships during the boom days of the 90's, though. They've nicely integrated the outstanding platforms that Mazda and Volvo developed into their entire global product line, which is a contributing factor to Ford having improved profitability so much...

Hmmm, I'm not so sure I agree with this.

PAG has lost considerable amounts of money recently, at its height Volvo made between $300-400 million, Jaguar's plants are underutilized, and Land Rover continues to struggle globally. In total, estimates run at between $15-20 billion dollars spent to purchase and reinvest in PAG members, and there isn't a whole lot to show for it. I'm not so sure Ford has done that well with its pricey purchases. And if I were a Ford shareholder, I think I'd like some answers. Oops, Jacques Nasser is gone.

Contrast that to say Renault's partial ownership of Nissan, which seems to have turned out to be a whole lot more successful. Of course, there's still much more work left to fully realize synergies between the two companies.

Ford is reasonably profitable for one reason: its financial operations are doing well for now - just like GM. And it won't take much action on behalf of Alan Greenspan to change that in a hurry.

It would behoove Toyota, as several GMIer's (including awalbert88) already indicated, to continue to focus mainly on its existing brands. That recipe seems to have worked well, thus far.

[jro4566]

Originally posted by Rex Raider@Sep 4 2004, 09:45 PM
Honda is marrying J.Lo.

She got divorced again!?! Well, considering how desperate she is I can picture this happening. :P

[SUPERBADD75]

Toyota seems to be an automaker that can expand itself by simply creating new marques and be successful in doing so. why bother purchasing Ford, or any other manufacturer for that matter? they already build world class cars, and in order to keep up that trend (and their reputation) they will continue to do what they've done for years. buying Ford would be nothing but a headache for Toyota. i hate stupid rumors like this one. they get everyone in a huff for no reason other than the enjoyment of the (rumor's) creator. Ford is in no danger of being bought out by anyone. they are on the verge of a breakthrough in my opinion, and they have the best selling vehicle in America. why sell out? just stupid.....

[karhopper]

Originally posted by gmwsag@Sep 4 2004, 05:07 PM
Oh come on.
I don't mean to laugh, but I can't help it. I mean, Toyota buying Ford???? In anyway, Ford would reject. They rejected the time The General offered to buy them, and they will most likely reject this time.

Actually, William Durant was planning to buy Ford Motor Company, but the bank that he asked for the loan thought the $8 Million price tag was to high and not worth it. <_< Go figure

[zaxxis]

Here's one thing alot of people forgot, when discrediting this rumor: Toyota has no need to buy ANY automaker. Period.

Toyota has so much money, so much momentum and so much self confidence that if they what to enter a particular market, they will do so on their own terms.

Unlike other companies, like Ford, GM, Renault, that focuses on buying companies to fill a particular product segment, instead of making their current brands better... Toyota will just create it. Why go through the hassle of integrating tens of thousands of people, systems and a companies culture into the Toyota hive mind when you can just create a new vehicle/brand from scratch? If Toyota wanted to enter the gas-guzzling-macho-mine-is-bigger-than-yours truck market [hummer] they could do it easily.

While there is nothing really wrong with the buy-out approach (as mentioned, I too think Ford's purchases have been very smart and will work out in the long run, unless they f-it up.) -- I'm just saying Toyota doesn't need to, they are in their own league right now.

-Z

[MN12Fan]

Originally posted by tgagneguam+Sep 4 2004, 08:02 PM--></div><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (tgagneguam @ Sep 4 2004, 08:02 PM)</td></tr><tr><td id='QUOTE'> <!--QuoteBegin-awalbert88@Sep 5 2004, 01:54 AM
...Ford has probably made the best use of the various buy-outs and partnerships during the boom days of the 90's, though.&nbsp; They've nicely integrated the outstanding platforms that Mazda and Volvo developed into their entire global product line, which is a contributing factor to Ford having improved profitability so much...

Hmmm, I'm not so sure I agree with this.

PAG has lost considerable amounts of money recently, at its height Volvo made between $300-400 million, Jaguar's plants are underutilized, and Land Rover continues to struggle globally. In total, estimates run at between $15-20 billion dollars spent to purchase and reinvest in PAG members, and there isn't a whole lot to show for it. I'm not so sure Ford has done that well with its pricey purchases. And if I were a Ford shareholder, I think I'd like some answers. Oops, Jacques Nasser is gone.

Contrast that to say Renault's partial ownership of Nissan, which seems to have turned out to be a whole lot more successful. Of course, there's still much more work left to fully realize synergies between the two companies.

Ford is reasonably profitable for one reason: its financial operations are doing well for now - just like GM. And it won't take much action on behalf of Alan Greenspan to change that in a hurry.

It would behoove Toyota, as several GMIer's (including awalbert88) already indicated, to continue to focus mainly on its existing brands. That recipe seems to have worked well, thus far. [/b][/quote]
There is much truth in your post. I've even heard many say that much of the quality problems that Ford had (and still has in certain circumstances as a result) during the mid to late '90s was because of so many financial resources being diverted to Nasser's expansion binge.

[stewacide]

Toyota and Ford have almost completely opposit strategies, as previous posters have outlined. Toyota is one giant, monolithic centralized organization that enters segments under its own brand or a newly created brand with its own in-house designs. Ford OTOH is becoming an ever more decentralized collection of specalist makers, aligned only so far as they can gain maximum economies of scale without sacrificing their identities and independence. To name just the major Ford subsidiaries that operate as seperate organizations:

- Ford NA/Lincoln/Mercury
- Ford Europe
- Mazda
- Volvo
- Jaguar
- Land Rover
- Aston Martin
- Cosworth engineering

...sort of what GM used to be before its brands one-by-one lost their independence to head office and their identities to engineering/design centralization.

Toyota-style centralization is good when things are going good, but can turn bad very quickly. Bad habits and design spread just as well as good: e.g. for all their praise-worth build quality and reliability when was the last time anyone called any Toyota-designed product good looking, let alone sexy/desirable? They simply can't keep on making the right moves forever.

Ford OTOH can spread the risk around better, althouhg at the cost of duplication. E.g. the latest Land Rover SUV could be a dud but the Lincoln and Volvo could be big hits, or Ford Europe may have a dud small car design but they can always borrow designs from Mazda's latest hit. You'll never see the mega-profits of a Toyota (when things are going right) but in the long-term it's more stable, and should have a higher marketshare plateau since they are better able to appeal to more consumer's tastes with truely unique vehicles/brands.