Ford vies for direct state aid in Germany

The US group Ford, apparently for the first time wants to be saved from the corona consequences with state money in Germany.

(photo by Ford)

The US automobile company Ford is apparently trying to get state aid in Germany to cope with the consequences of the corona. The automaker had submitted an application for government guarantees in the amount of 500 million euros, reported the local German newspaper Handelsblatt on Monday without a specific source. A large part of this should be taken over by the federal government, a smaller part by the federal states.

Ford kept a low profile on the process, but did not deny: “Basically, it is part of our normal business to be in constant communication with financial institutions and other partners. Please understand that we do not publish any further details,” said one Spokeswoman for the Reuters news agency.

Ford Germany boss Gunnar Herrmann (60) is quoted in the “Handelsblatt” as follows: “At the beginning of the corona crisis, we evaluated loans. But we were able to keep our capital base stable through temporary short-time work and other measures.” The Federal Ministry of Economics did not want to comment on the report, and the NRW Ministry of Economics did not initially receive a statement.

Stock price down 30%

The US group Ford, which was already ailing before the Corona crisis, would be the first car company to apply for direct state aid in Germany. So far, the industry has only been concerned with indirect aids such as purchase bonuses or lowering VAT. The Ford plants are one of the largest car companies in this country. They employ more than 22,000 people in Cologne, Saarlouis and Aachen. Within the past five years, the stock market value of the US parent company had collapsed by more than half, since the beginning of the year by around 30 percent.

In the course of the crisis, the federal government set up several instruments to rescue companies in need. Central to this is the Economic Stabilization Fund (WSF) with a volume of 6.4 billion euros, which is headed by the two State Secretaries Jörg Kukies (52; Ministry of Finance) and Ulrich Nussbaum (60; Ministry of Economic Affairs). The state can issue guarantees for lending through the WSF and participate directly in companies.

The Ford case reveals one of the hitherto unsolved basic problems associated with state bailout funds. How do you deal with companies whose mother is abroad? In the Federal Ministry of Finance there is concern that Corona rescue funds, which were intended to stabilize the subsidiaries in Germany, could flow abroad. A similar problem arises at MV Werften in Mecklenburg-Western Pomerania, which have also applied for state aid and which the Genting Group from Malaysia is behind.

Author: Nabeel K

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