Ford Has To Put Together A Game Plan For Kerkorian

Implications: They may have been taken by surprise as they claim, but Ford had better put a game plan together quickly if they are to deal effectively with the latest bid by investor Kirk Kerkorian.

Analysis:  Depending on whom you believe, Ford Motor Co. executives found out on April 4 or April 26 that Kirk Kerkorian had an interest in investing in the company.

On April 28 Kerkorian announced publicly that he had already acquired 100 million Ford shares. His filing with the SEC on Friday also disclosed that he intended to purchase an additional 20 million shares.

Regardless of when they found out, Ford needs to take several steps if they wish to maintain control of the company.

First, rally the controlling Ford family by assuring them that Kerkorian nor anyone else can take control of the company so long as they hold their Class B shares as a block and stand behind CEO Alan Mulally's "One Ford" turnaround plan. That in itself would be an accomplishment given Ford's history of giving up on initiatives whenever someone at the top either loses interest or loses his job.

Second, make clear--as Executive Chairman Bill Ford did at Thursday's annual meeting--that his hand-picked successor, Mullaly is staying put. Whether you like his bottom line approach or you can't stand it, Mullaly disciplined simplification is the best thing to hit Ford since the '86 Taurus.

Third, Fords leaders should signal their intent to accelerate their turnaround. Obviously they are on the right track, making enough progress to get the attention of Jerry York, Kerkorian's automotive guru. Nothing annoys York more than companies he picks for Kerk that don't keep moving in the direction he envisions.

One thing is  for sure, Kerk likes a challenge, and less than a month from his 91st birthday, he's thinking long-term. You have to admire him for that.