DEARBORN -- Divergent business models among automakers and higher levels of government involvement require more than ever that Ford Motor Company has a strong voice in Washington and in state capitals throughout the country. The same is true in major markets around the world. Ziad Ojakli, group vice president of Government and Community Relations, discusses the company's strategy with @Ford Online.
Q. What is Ford Government and Community Relations doing to ensure the company's voice is heard by U.S. lawmakers and regulators?
A. First of all, we are leveraging the positive ONE Ford message and highlighting our products as "proof points" that we are leaders in technology, safety, fuel economy and value. Second, we are leveraging Ford's strong management team across all functions to interface with key officials in Washington, state capitals and international markets to reinforce the Ford story. And third, we are letting elected officials know that we care about supporting those who are willing to listen to our message and work together with us to address the challenges and opportunities ahead on our business issues.
However, as a result of our downsizing, we have a smaller base of political support. In the U.S., if you look at our operational footprint and employee base, we are primarily focused in five states. We must, therefore, work on common issues collaboratively with our supplier, dealer, and industry partners more than ever. This is where the Ford Political Action Committee, or PAC, helps us amplify our outreach to support those who are willing to work with us on critical issues in all 50 states. Everyone who is currently a member of the PAC should know that they are helping to ensure our voice is heard.
There are federal and state mid-term elections coming up later this year, so we're already working hard to make sure those who are running for office in key states understand the importance of auto manufacturing, especially to our economic recovery.
Q. Alan Mulally has said that we're fighting for the soul of manufacturing. Is that message being received?
A. It's beginning to be received, but it needs to be repeated over and over again. There are so many competing priorities at the federal and state level that we must continue to leverage our voice through the Ford PAC and by working effectively with our suppliers, dealers and industry partners. There were a couple ways we started highlighting this message. For example, we looked for opportunities during the 2008 presidential campaign when we made sure that both candidates and parties knew that the road to the White House went through heavy manufacturing states, particularly strong auto states – Indiana, Michigan, Ohio, Kentucky and Missouri. We sent a clear message that it was important for us to know where the candidates stood on issues that impact our bottom line.
We are also working to amplify our manufacturing message as it relates to trade agreements. Typically, agriculture, financial services and pharmaceuticals are all negotiated up front in trade agreements and those industries usually fare well. Manufacturing, which makes up most of our trade between countries, is often an afterthought. We are working to give manufacturing the priority it deserves, given its importance to the U.S. economy.
Q. What are some other major challenges facing Ford?
A. They run the gamut from making sure that climate change legislation is done in a common-sense, comprehensive way, to addressing safety, trade and currency issues. There is rarely an issue that doesn't touch Ford in some way.
We have concerns with the U.S-Korea Free Trade Agreement. We’re for free trade – this isn’t. On currency, we want to make sure that no government puts a thumb on the scale – we want the market to determine the value of currency. By manipulating currency, vehicle exporters from overseas countries can increase their pricing and margins by thousands of dollars per vehicle.
For example, five years ago, we saw a problem in Japan on currency manipulation. We highlighted it, flagged it and did everything we could to put up a firewall against it. Now, we're doing the same with Korea’s manipulation of the won. We need legislators who understand this issue and want to help.
We're still working on lowering our cost of capital, so loan programs like the U.S Department of Energy and European Investment Bank loans are very important to us. We also are attempting to secure appropriate government incentives for our growing global investments.
Another important objective is to ensure that vehicle electrification policies around the world are consistent with our plan and work for us. For instance, we need to be on the ground floor as China develops its electrification strategy.
Q. What is key to developing strong partnerships with government officials?
A. Elected officials want to know that they are talking to a trusted source. Trust is established, in part, by being transparent and acknowledging both sides of an issue. You can advocate for one side – and we do – but you always want to recognize the entirety of the issue.
These days, there is unprecedented government engagement in all aspects of what we do. So, it is very important that we are sending clear, consistent messages to our elected representatives about our position and how they can help manufacturing and Ford Motor Company.
Q. How has Ford changed the way it works with policymakers?
A. We have a positive vision of what we are for and how we can work together. It used to be the auto companies would say, 'we can't do that.' Ford's approach is that we try to understand the objective and work together to find the best way to reach our shared goal.
For example, in the past, the industry did not work as collaboratively with policymakers on fuel economy standards. Now, Ford is leading efforts to work proactively with federal and state legislators to shape the future of fuel economy standards and advanced technology applications.
Korea is another good case in point. What Ford has always said is that we are in favor of free trade. We don’t want to “kill” this agreement; we want to improve it to create opportunities for us to sell vehicles in a large market – Korea. Korean automakers already are in the U.S. market. We need to ensure that we have an equal opportunity in theirs.
Q. How do most U.S. lawmakers view Ford at the present time?
A. Very positively. Not taking government money and pulling ourselves up by our bootstraps has been extremely well received. They love our plan! They want to know what’s happening next, and many are rooting for Ford. We've also built a lot of trust in terms of being a credible resource for lawmakers on various issues.
Q. What are some recent examples of the PAC's effectiveness?
A. Cash for Clunkers, which we won by one vote in the Senate, is a good example. Ford was the automotive driver behind this bill. The Department of Energy loans – $5.9 billion in low-interest, green technology loans – is another. In both cases, the elected officials with whom we have developed relationships understood that consumers needed some incentive to purchase new vehicles and that we needed low-cost capital. We were successful in obtaining both. With the help of the PAC, we were also able to reach out to legislators who do not normally engage with the auto industry and help them understand that the credit markets were broken and needed attention.
This is an extraordinary time where so many actions by policymakers affect our business. Every day – at all levels of government – elected officials take actions that impact the auto industry. If we are not part of the discussion, adding our voice to the debate, then we may wind up with policies that are detrimental to Ford and the auto industry. It’s important for everyone at Ford to take an active role in the government process, because when we speak collectively we speak powerfully.
Click here for a link to frequently asked questions about the Ford PAC.