The Crier

Goodbye, Bond-Mobiles

Aston Martin is back in British hands. This is a bad sign for American managers

Alex Dziadosz · The Exchange · Mar 13, 2007

This week, Ford finally pawned off Aston Martin, the line of luxury cars driven by nearly every James Bond from Connery to Craig. This sale is likely only the first in a series that may yet encompass Ford’s other specialty brands such as Jaguar and Land Rover.

This Monday, the New York Times reported that David Richards, head of British engineering group Prodrive, will lead a set of investors in buying out a majority share of Aston Martin for $868 million. Ford will retain a stake of about fifteen percent — just enough to save some face.

It’s all part of the unfortunately titled Way Forward, a frantic attempt to put Ford in the black by 2009, which has so far meant mortgaging assets and paring production to bare essentials. Uncomfortable analogies with Mao Zedong’s ruinous agricultural policies aside, Ford’s desperation reveals two declining trends: that of American manufacturing (near its end), and of American management (near its beginning).

Ford’s desperation reveals two declining trends: that of American manufacturing (near its end), and of American management (near its beginning).

It’s common knowledge that the American auto industry has been floundering. So it’s no surprise that Ford is jettisoning vanity programs like Aston Martin that, for all its glitz, never really earned much. But the most troublesome aspect of this loss is not the revelation that the auto industry is sinking, but that it might mean America is losing footing in an area it has perennially led: good management.

After bouncing between hands for decades, Aston Martin finally landed in Ford’s in 1993. The Detroit automaker, confident in its managerial prowess, beefed up production. And they did rather well with it — for a little while.

Soon enough, Ford flopped. Just a few months ago, they resorted to bringing in consultants from Toyota (a somewhat ironic gesture considering Toyota owes much of its business model to the instruction of Ford consultants in the years following World War II).

But the case for Ford’s impending troubles hardly needs expounding. Students of even the most rudimentary economics understand that free trade works by allowing countries to specialize, and if they’ve picked up a newspaper in the past decade, they also know that America’s days as a manufacturing specialist have passed.

Even as America’s capacity for technical and scientific ingenuity falters, it remains globally relevant because of its managers and marketers.

This past summer, a Columbia Business School study argued that even as America’s capacity for technical and scientific ingenuity falters, it remains globally relevant because of its managers and marketers. In the coming years, America won’t have a chance at competing with countries like Indonesia for cheap labor, or Singapore for technical ingenuity. Good management is necessary for us to keep pace.

But with Ford forfeiting management rights of their luxury British brand just as Nanjing Automobile Corporation, a Chinese company, acquires another (MG), it appears even this advantage might be eroding.

Granted, Ford is a particularly extreme example of current troubles; companies like Google and Apple still brim with entrepreneurial and managerial vigor. Still, the auto giant’s slippage should give us pause.