Ford sells majority of Mazda stake
Author: Robin Brown
Published: 18 November 2008
Hot on the heels of GM selling its stake in Suzuki, Ford has sold most of its stake in Japanese manufacturer Mazda for $540m in order to bolster cash reserves.
Ford is selling a 20 per cent stake in Mazda, leaving around its share of Mazda at around 13 per cent. The sale will mean Ford is still Mazda's largest share-owner but will reduce the Blue Oval company's role in Mazda.
Along with GM and Chrysler, Ford is desperately seeking cash from the US government as a succession of poor choices and declining markets has hit US automakers.
The benefit to both companies in the relationship is sharing parts and platforms, with Mazda's small car expertise put to use by Ford in the new Fiesta.
Ford first invested in Mazda in 1979 and increased its stake in 1996, saving the Japanese firm from bankruptcy after a failed attempt to diversify its brand. Just five months ago Ford's entire stake in Mazda was worth $2.73bn.
In the last 18 months Ford has sold off nearly all of its Premier Auto Group, including Aston Martin, Jaguar and Land Rover - netting a mere $1.5bn for all three. A sale of Volvo is considered likely over the next year.
Ford historically uses Mazda to groom future European and US executives, and the Japanese manufacturer has thrived under the Ford partnership. Ford will be reluctant to part with its stake, and the fact that it is underlines how serious the situation of US manufacturers has become.
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