Word: forde
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Dates: during 1980-1989
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...flood of imports -- more than 3 million last year -- has leveled off because the fall of the dollar against other currencies has made Japanese and European cars much more expensive in the U.S. While the cost of many Japanese models has gone up by 25% or more since 1985, Ford has been able to hold price hikes during the same period to an average of 7% (and only 4% on the smaller cars that compete most aggressively with imports). Still, Japanese imports managed to win 21.3% of the U.S. market last year, up from...
...Ford knows that the competition remains formidable and that prosperity in ! the auto business is never assured. Perhaps the greatest danger to the company's momentum is a slowdown in the U.S. economy. At 5 1/2 years, the current expansion is unusually old, and many economists expect a recession to hit next year. Already, interest rates are on the rise, which could slow auto sales by making it harder for customers to afford car loans...
...company is prepared to weather a downturn, Ford is. The bleak years of 1980 through 1982, when it lost $3.26 billion, taught the company how devastating a recession can be. Philip Caldwell, Ford's chairman at the time, was forced to cut costs drastically and boost productivity. When Petersen took over as chairman in 1985, he oversaw an equally relentless slashing of expenses...
...result, the Ford Motor Co. of 1988 is sleeker and stronger than the bloated Ford of the 1970s. Since 1979, the firm has shut down 15 of some 165 plants worldwide and eliminated 60,000 of 165,000 blue-collar jobs and 20,000 of 73,000 white-collar positions. That enabled it to reduce annual operating costs by $5 billion, to an estimated $65 billion in 1987. Over the past few years, the company has amassed cash reserves of $10 billion, which should make a recession bearable...
Cost cutting, though, was only one part of the recovery plan. Under Petersen, the company has developed a worldwide strategy for prospering in an increasingly competitive business. Ford has always had a major presence overseas, especially in Europe, but its operations around the world often duplicated one another's efforts. A European subsidiary, for example, would make cars for its market, while Detroit was building similar vehicles for the U.S. There was remarkably little coordination, specialization or division of labor, even though domestic and foreign vehicles were becoming more alike...