Ford Sells Controlling Stake in Mazda

(MoneyWatch)  In a move that normally would have been big news, if Ford, GM and Chrysler hadn't been fighting for their lives in Washington last week, Ford abruptly announced it will sell most of its share of Japan's Mazda Motor Corp. for about $540 million, and give up control of Mazda.

The two companies have been partners since the early 1970s, culminating in Ford buying a controlling share of Mazda in 1996, when Ford upped its share of the company to 33.4 percent, enough to constitute a veto over board decisions.

Ford is cutting its stake to only 13 percent. Mazda and some of its affiliated companies are buying back the Mazda shares, Ford said in a Nov. 18 announcement. In September, Mazda officials said at a press introduction for the all-new Mazda6 model that there were no changes planned for the Ford relationship.

Ford will keep a seat on the Mazda board. In addition, the two companies will continue to share product platforms, engines and transmissions, said Hisakazu Imaki, Mazda chairman, president and CEO.

The move is only the latest in a string of asset sales for Ford. Ford sold Jaguar and Land Rover to India's Tata Motors in March 2008 for about $2.3 billion, partly offset by Ford's agreement to pay $600 million for Jaguar and Land Rover pensions.

Ford cutting its Mazda stake makes Sweden's Volvo Car Corp. stick out even more like a sore thumb, as the only overseas brand solidly in the Ford orbit -- the only brand, in fact, other than Ford, Lincoln and Mercury. Ford continues to insist it intends to keep Volvo.

In the U.S. market, Mazda is in relatively good shape. Through the end of October, it has an increased market share of about 2 percent, up from 1.8 percent in the year-ago period, even though year-to-date sales were down 7.5 percent to 231,850, according to AutoData Corp. That's because the rest of the U.S. market on average is down more.