Ford Sells Majority of Mazda Stake to Raise Capital

November 18, 2008
Today Mazda announced that it and several of its strategic partners will acquire more than two-thirds of Ford's shares in Mazda. This on the heels of GM's sale of it's stake in Suzuki. Ford's ownership will drop from its current 33.4 percent to around 13 percent as a result of the move, but Mazda states that the two automakers "will continue their strategic relationship" that encompasses roughly 30 years.

To process the transaction, both Mazda and Mazda business partners will purchase shares of Ford-owned Mazda stock. Mazda and Ford claim they will continue with their joint ventures, vehicle development, and platform/powertrain sharing such as the Ford Fusion/Mazda6/Mercury Milan platform-mates.

Says Ford CEO Alan Mulally, "this agreement allows Ford to raise capital that will help fund our product-led transformation." Ford, along with domestic automakers GM and Chrysler, has been burning through record amounts of cash just to stay afloat during exceedingly tough times due to lagging sales and reduced availability of credit to would-be consumers. In the third quarter of 2008 alone, Ford spent $7.7 billion to remain solvent.--Colin Mathews

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