Ford Not Looking to Slash Dealer Ranks

Ford Motor Co. is not looking to significantly reduce its U.S. dealer network, which currently stands at 3,770 stores, the auto maker's top executive says.

President and CEO Alan Mulally says the auto maker has no intentions of keeping pace with rivals General Motors Corp. and Chrysler LLC as they trim thousands of dealers across the country as part of their ongoing restructurings.

“Ford does not have to match dealer cuts,” Mulally says. “We moved decisively to focus on the Ford brands, divested Aston Martin (Lagonda Ltd.), Jaguar (Car Corp.) and Land Rover, took down our relationship with Mazda (Motor Corp.) and put Volvo (Car Corp.) up for sale.

“So there's a whole distribution network that goes with each of those (brands),” he says.

Some more surgical trimming is likely, however. Ford dealers have asked the auto maker to consolidate the number of stores it has, especially in urban areas, Mulally says.

“They want their throughput and profitability up.”

Meanwhile, Mulally says Ford chose a good time to divest its non-core brands, noting as the economy worsened, it has become increasingly difficult for auto makers to sell operations.

“You can imagine what everybody (trying to sell brands) is going through now in this environment,” he says. “It's really tough.”

Thanks to a $23.4 billion line of credit secured in 2006, Ford has sufficient liquidity to fund its product plans, Mulally says.