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Petersen steers Ford along unmapped road

By Charles E. DoleStaff writer of The Christian Science Monitor / September 27, 1985

Dearborn, Mich.

THE chief executive at Ford can handle a high-performance car on a test track as well as some of his drivers. As he scans the Detroit landscape and the company's condition from his 12-floor office at Ford's world headquarters here, Donald E. Petersen talks options the way a racer judges cornering and acceleration. One of those options, and one that would affect thousands of American jobs, is building more Ford cars overseas ``where the cost is right.''

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Other options have been fraught with risk. The dynamic and personable chairman told his designers to ``forget the past'' and ``do something different.'' The result: the jellybean look of the Ford Motor Company's new cars.

Petersen insists that Ford engineers and executives be put through the paces of high-performance driving because ``the customer, after all, uses our product in motion.''

When he talks about the future of the automobile industry, Petersen, an engineer himself, conveys a combination of zeal and dismay.

``What discourages me most is the inaction'' of the federal government on the issue of foreign trade, he laments, looking the interviewer straight in the eye. President Reagan has held firm against such protective measures as the import quotas sought by many American companies, preferring instead new initiatives aimed at bringing down the value of the dollar and encouraging the opening of foreign markets to US goods.

The Ford chief executive wants to know ``what it is that is causing the whole matter of currency exchange to work to our disadvantage and in favor of the Japanese.'' Expectedly, he is cagey about Ford's strategies to meet the troubling situation. But he insists that ``we want to sustain as much of our manufacturing here in the United States as we possibly can.''

On the one hand, he hints at no immediate decisions on either the production or marketing of Ford cars, saying that Ford will keep its options open ``if we can maintain sufficient flexibility through another election.'' On the other hand, he seems resigned to the apparent status quo, saying, ``The indications are that we are not going to get any specific actions from the federal government such as voluntary-restraint approaches, or perhaps a surcharge, when bilateral trade in any one situation becomes e xcessive.''

The huge trade and budget deficits distress him, as do the tax policies of the federal government. Indeed, he points to the dilemma of the entire domestic automobile industry as it watches the growing tide of Japanese-built cars and the arrival of even more competition from such low-cost producers as the South Koreans and Yugoslavs.

In its hunt for lower labor costs, Ford will import small cars from Korea and Taiwan in the late 1980s and will get cars from the assembly plant it is now building in Hermosillo, Mexico, as well as 40 to 60 percent of the total output when its Japanese affiliate, Mazda, begins to produce cars in Michigan in 1987. Ford is also discussing deals with Italy's Fiat as well as officials in Peking.

Will Ford have to import its large cars as well, in addition to components, to cut costs? The answer may depend on what the federal government does to balance the scales and make the American automobile industry more price-competitive with the imports.

``Never have we faced such a challenge to successful continued production in the United States, our home base and traditionally the source of our strength,'' he told a congressional subcommittee of the Joint Economic Committee in Washington last week.

Ford already has slashed tens of thousands of jobs from its worldwide work force and plans a further white-collar reduction of 25 percent over the next few years. ``The Japanese have found ways to achieve results with fewer people,'' Mr. Petersen comments.