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Ford Submits New Bailout Plan, Will Make Concessions

By Alan Stewart Carl | Related entries in Business, Cars, Congress

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Looks like Ford Motor Co. is now willing to make some concessions should they receive a government bailout.

CEO Alan Mulally said he’ll work for $1 per year if the automaker has to take any government loan money.

The plans Ford submitted to Congress on Tuesday also say the company will cancel all management employees’ 2009 bonuses and will not pay any merit increases for its North American salaried employees next year.

The company also said it will sell its five corporate aircraft.

It’s a start. Of course, Ford is not in as bad a shape as GM. The company believes it will break even by 2011 and is only seeking $9 billion in government loans, a credit line Ford may not have to use. The company has enough cash to continue its operations through next year.

I think it’s pretty clear that the bailout backlash helped spur Ford into making concessions and toning down the “sky is falling” rhetoric. We’ll see if Chrysler and GM follow suit. Hopefully, cooler heads will prevail in both the automaker boardrooms and the Congressional committee rooms.

We’re already moving past the blank-slate bailout approach. But the burden is still on the automakers to demonstrate why government assistance is the only remedy and how such assistance will be used not just to kick the problem down the road but to actually revive the companies.

This entry was posted on Tuesday, December 2nd, 2008 and is filed under Business, Cars, Congress. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

6 Responses to “Ford Submits New Bailout Plan, Will Make Concessions”

marcus Says:
December 2nd, 2008 at 11:36 am
Better late than never, I suppose…
Tube Says:
December 2nd, 2008 at 11:47 am
What concessions will UAW be making?
Susanna Says:
December 2nd, 2008 at 12:30 pm
But like others have said, Ford was already trying to revamp the way it did business before all this happened, so they’re a little ahead of the curve. Not surprised they’re the first to come up with an actual plan.

Curious to see what GM does.
mp97303 Says:
December 2nd, 2008 at 2:45 pm
The concessions may be of a symbolic nature, but they are exactly the kind of “PR” moves Ford needs to make right now.
Jim S Says:
December 2nd, 2008 at 4:53 pm
Tube,

Are you aware that the UAW started making concessions over a year ago?
Booker Rising Says:
December 2nd, 2008 at 5:58 pm
Ford Submits New Bailout Plan, Will Make Concessio…

Alan Stewart Carl, a moderate blogger, writes about Ford’s plans to pay its CEO $1 per year, cancel management bonuses, and sell its corporate aircraft if it takes a government bailout: “It?s a start. Of course, Ford is not in as bad a shape as GM. …

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