I don’t profess to be an auto guy or anyone of influence. However, behind closed doors, I have managed to convince a multi-billion dollar corporation to switch gears and embrace new concepts. Today, the news is out that Ford is once again mulling a decision to sell Volvo. Last July, I suggested a sale to Honda, who could probably use the Volvo brand to bolster its luxury segment.
Ford: Get rid of Volvo and focus on a strategy to buy General Motors and Chrysler in bankruptcy, because Detroit doesn’t deserve a taxpayer bailout. What Detroit needs is change, which is long overdue. The city’s my hometown, so I think I’m in a great position to state the obvious. No bailout. The auto industry is as brittle and hollow like the many abandoned homes in Detroit, like this one:
Ford is the only automaker in town with almost $30 Billion worth of cash and credit at its disposal. This places the company in an incredibly powerful position to ‘throw its weight around’. It’s time for a consolidation in Detroit:
- Develop a plan to acquire the brands and assets of both General Motors and Chrysler in bankruptcy
- To gain government approval, the company MUST divest its interest in several GM and Chrysler brands, plants
- Approach congress for ‘future financial support’ in the event more capital is needed to save jobs, retool factories
- Get rid of those blood-thirsty union commitments — They’re just as much the problem as Detroit’s lack of innovation to be competitive in the global economy. Renegotiate. Get concessions
- Improve employee morale by inspiring them to feel like stakeholders (I have a creative approach to achieve this) — This means doing more than simply improving product quality
Now is the time to consider all options, because no idea is a bad idea. Sink or swim. The foreign automakers are ready to dine on your front porch.
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This is one approach but not sure how it would turn out. Consolidation seems inevitable; a bankruptcy reorganization could give them more options, but that might actually hurt any sales & cash flow in the near term. Spinning off certain assets and re-focusing on new growth seems like the way to “grow”, IMO.
Last company I worked for thought it could cut is way to growth & profitability – they were, and still continue to be, wrong.