AFSCME 3357-HOF'S BLOG

Detroit News Reports on Ford Family Meeting

The Detroit News article published this morning gives an interesting behind-the-scenes look at a recent Ford family meeting. When I say Ford family, I'm talking about the 13 great grandchildren of Henry Ford (and other associated kin) who together hold 70 million shares of Class B Ford stock and control 40% of the entire voting rights of the company. Because (so far) the Ford family has voted its shares as a bloc, even though the family controls a minority of the total shares outstanding, the family has effectively controlled the company.

The report discloses restlessness and cluelessness on the part of some family members. The restlessness was shown by a spirited discussion on whether to hire an outside investment banker to represent the family's interest. The cluelessness was illustrated by one family member asking when the company is going to restore dividend payments. Dividend payments are nowhere in the immediate future. Last year Ford reported a $12.7 billion loss, and it mortgaged all of its substantial assets in order to generate $23 billion with which to fund its turn-around plan. The market value of the family's stock has plunged to about 1/4 of it's value in 1999, and dividend payments have gone from $130 million per year to zero.

The sad state of the Ford family makes me think of the Ford Family version of Clarence Carter's song Patches. "Every day we had to cash T-bills, cause that's the only way we'd work our deals." I'll work on it.