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Ford may step into the breach

Thu., Oct. 5, 2006

DETROIT — The collapse Wednesday of General Motors Corp.’s potential alliance with Nissan and Renault has revived speculation that Ford Motor Co. might step into the breach.

Ford shares rose 4 percent, the same increase triggered by an August report that Bill Ford, Ford’s chief executive at the time, had approached Carlos Ghosn, chief executive of Renault SA and Nissan Motor Co., about linking the three automakers.

Ford, however, refused to say Wednesday whether it was interested in an alliance with the two foreign automakers, and analysts downplayed the likelihood of a partnership forming anytime soon.

“This is not a big surprise. GM management has appeared less than enthusiastic about an alliance all along,” Morgan Stanley analyst Jonathan Steinmetz said in a note to investors after GM, Renault and Nissan jointly announced they were calling off talks.

“This paves the way for Ford, but it may not be immediate. … Ford management’s seeming willingness to explore an alliance is a big difference versus GM,” Steinmetz said.

The Wall Street Journal reported Aug. 23 that Bill Ford, now the company’s executive chairman, had approached Ghosn about joining the global alliance. The story, attributed only to “a person well-positioned to know,” triggered a 4 percent jump in Ford shares that day.

“Right now we’re looking at things, but we’ve had no contact with Ford at this point that I’m aware of,” Nissan North America spokesman Fred Standish said Wednesday. “But we don’t know what the future may hold.”

Ford shares rose 33 cents to close at $8.56 on the New York Stock Exchange. GM shares were down 9 cents at $33.32.


 

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