Fred Harteis Business News - Ford's ties to Iran questioned

Fred Harteis Business News - The Securities and Exchange Commission on Friday disclosed that it asked Ford to detail its business ties to Syria, Iran and Sudan - three countries the U.S. government considers "terrorist-sponsoring states."

In a chain of correspondence, released on Friday but dating back to July, the SEC asked Ford to demonstrate that its "reputation and share value" were not at risk because of its business in those countries.

In mid-August, Ford said it sells vehicles through dealerships in Syria, while its Land Rover subsidiary sells its sports utility vehicles through a British distributor in Sudan.

Mazda, in which Ford has a 33 percent stake, sells its products through Japanese trading companies in Iran and Syria, Ford said.

Our limited and lawful business activity in Syria is public information, and we have not been able to identify any resulting negative impact on our reputation or share value," Ford said in a letter to the SEC dated Aug. 16, 2006.

The SEC responded to Ford a week later, saying it had no further comment on the company's annual financial report.

A Ford spokeswoman and a SEC spokesman declined further comment on Friday.

The unusual exchange between the No. 2 U.S. automaker and the SEC follows letters written by the regulatory body to European and U.S. oil companies, asking them to inform investors about the risks they face from investing in countries the U.S. identifies as those supporting terrorism.

Ford said in the letter to the SEC that sales of Mazda vehicles by the distributors to outlets in Iran and Syria combined resulted in sales revenue of less than $60 million in 2004 and 2005, and $85 million in 2003.

"We do not believe that this de minimis business activity by Mazda impacts Ford's reputation or share value, or the value of Ford's ownership interest in Mazda," it said in the letter.

The authorized dealerships that sell products of Ford's non-U.S. subsidiaries in Syria are neither owned nor controlled by the Syrian government or government officials, Ford said in response to a SEC inquiry of distributor Griwati Auto in Syria.

The automaker further said it did not believe that any of the vehicle sales by dealerships in Syria in recent years were to the Syrian government or government-controlled groups.

But Ford said Land Rover vehicles were sold to various government departments in Sudan, with the bulk of the sales volume going to the Sudan's Ministry of Interior.

Source: Cnn.com

About Fred Harteis: Fred Harteis leads Harteis International.  Fred Harteis has a background in agriculture and has created many successful business ventures.

Fred Harteis Business News - CEO: Ford ahead of schedule on layoffs

Fred Harteis Business News -  Ford Motor Co. is "a little bit ahead" of schedule in settling buyout offers with its 75,000 unionized factory workers, the automaker's chief executive told the Detroit Free Press in an interview published Saturday.

Alan Mulally, who took over as Ford’s top executive about six weeks ago, was also quoted by the Detroit News as saying that the embattled No. 2 U.S. carmaker needs to make its North American operations profitable by 2009.

"We have got to turn around North America and be profitable by 2009," Mulally was quoted as saying. "Because if not, you just keep losing cash and pretty soon you run out."

Both interviews were given Friday, according to the newspapers.

Ford's student driver takes the wheel

All of Ford's blue-collar workers represented by the United Auto Workers union have been offered buyout packages to leave the company's payroll. Those offers, which are central to Ford's plan to cut costs in response to its sliding market share, are open to consideration until Nov. 27.

"I would say we are a little bit ahead (of schedule)," Mulally told the Detroit Free Press. "We're getting a really good response about the way we're doing it and that they have choices and they can do it in a timely manner and move on or stay."

Ford's larger rival, General Motors Corp., surprised Wall Street analysts earlier this year when it convinced some 28,000 of its unionized workers to take a similar buyout package.

Some industry observers had questioned whether Ford would have equivalent success with the program given that its workforce is younger on average than GM's.

Separately, Mulally said in his interviews with the Detroit newspapers that he had not decided whether to shed some of Ford's car brands. But he indicated that there was potential to cut costs by streamlining Ford's management and planning process.

"There is no plan to do that tomorrow," he told the Detroit News. "But we have got to leverage and simplify and use the resources we have around the world."

The Detroit Free Press quoted Mulally as saying he saw unlimited potential to save money by simplifying and unifying Ford's operating structure, which is now broken up by geography and product line.

Source; Cnn.com

About Fred Harteis: Fred Harteis leads Harteis International.   Fred Harteis has a background in agriculture and has created many successful business ventures.