Good News From Ford, But Was It A Better Idea?

Well, they may not have had a better idea at Ford, but something's been working better for the folks from Dearborn than their pals at GM and Chrysler. Analysts were stunned by Ford's third quarter profits report. It seems while the other U.S. automakers were filing for bankruptcy and begging for government bailouts, Ford was determined to do what it could to right its own ship. Oh, they took full advantage of the "Cash for Clunkers" program, which certainly fueled their third quarter sales. But profits were also boosted by cost cutting layoffs, certainly not good news for those who now find themselves unemployed. And in the long-term it remains to be seen how Ford will make out in negotiations with its union workers, who will likely balk at management attempts to reduce both workforce and labor costs by freezing or cutting benefits.

And, in an economy that is far from robust, with no end in sight for alarmingly high unemployment, it remains to be seen how well Ford will do in sustaining sales without adjusting the prices of its products. Cash for Clunkers effectively served as a $4500 price rollback, for much of the third quarter. But how is the year going to finish out without that artificial sales incentive? Third quarter profits may well be followed by dismal fourth quarter performance. For may be in a better position for now than its main U.S. competitors, gaining a bigger share of a shrinking auto market in the short term. But there are still a lot of unemployed and financially strapped folks who have not driven a Ford lately, and will not be likely to anytime soon.

So, while I congratulate For on its third quarter, without the "Cash for Clunkers" crutch, which wasn't Ford's idea, I wonder what better ideas we will see from Dearborn that will truly turn things around for Ford, for Ford workers, and for Ford customers. Because, regardless of what the reports from headquarters said, the local Ford dealer went out of business here just a few weeks after the government's gimmick program, so at least in that case corporate profits did not translate into local business. And given the economic realities of this area, no one is likely to reopen that business anytime soon. What is more liable to happen is that other dealers will be closing their doors. So, at least in this case, we're still looking for a better idea that works for folks across America, as opposed to in America's boardrooms.

Jesus told a parable about a rather dishonest manager who, facing the loss of his job, shrewdly negotiated debt-reduction agreements with enough folks to convince his master to keep him. (Luke 16:1-13) The lesson was not intended to encourage dishonesty, but suggests to me the wisdom of forgiveness, how it can both foster loyalty, and be more profitable in the long run than the relentless pursuit of unfair profit. This is not to say that the management at Ford, or GM or Chrysler, is dishonest. But businesses voluntarily lowering the costs of goods and services, and reducing and forgiving debts, might be a better solution to our economic woes, than the heedless and unbridled pursuit of bigger and bigger profits for fewer and fewer Americans.