Bill Ford calls for health care fix
Ford CEO says rising health costs, fair trade and legal reforms challenge the U.S. economy.
By Jeff Plungis / Detroit News Washington Bureau
WASHINGTON -- Ford Motor Co. CEO Bill Ford Jr. called on the federal government and business leaders Wednesday to find new solutions to rising health-care costs and other challenges that threaten the long-term health of the U.S. manufacturing sector.
In a speech before the U.S. Chamber of Commerce, Ford said rising health care costs, fair trade agreements, legal reforms and government promotion of new technologies are the biggest issues challenging the U.S. economy.
"Some of the key issues are bigger than any one company or any one industry," Ford said. "In order to tackle them effectively, we need the collective action of government and industry working together, to ensure the U.S. remains competitive, and our economy stays strong."
On health care, the biggest drag on the competitiveness of Detroit's automakers, Ford said he hoped the Bush administration and Congress would specifically look at the costs of catastrophic care. Ford spent $3.2 billion on health care last year and faces another steep increase next year.
Ford and other manufacturers have stepped up pleas for relief from rising health care with lawmakers. Recent surveys have shown the sharp rise in health care has made employers reluctant to hire new employees, putting a drag on economic growth.
General Motors Corp. warned investors Wednesday that the automaker's health care tab is forecast to rise an estimated 10 percent in 2005 from an estimated $5.1 billion this year.
Ford said medical malpractice costs - an issue highlighted by President Bush during the campaign - and additional coverage for the uninsured must also be addressed.
After the speech, Ford said it was too soon to go into specifics on initiatives that might help.
"We just had an election, so it's hard to know where the landscape is right now," Ford said. "We'll spend some time over the next few months to get a sense of where Congress is, and then we'll engage in a dialogue. It's way too early to get into any kind of specificity. It's too early on our part, and it's too early on the part of Congress."
Ford said the United States spends more on health care -- $1.7 trillion in 2003 -- than any other nation. Ford's health care costs soared to more than $3.2 billion in 2003, up from $2 billion in 2000. The company spends more on health care -- more than $1,000 per car and truck sold -- than it does on steel.
"This is a pace we cannot sustain," Ford said, but added his call for reform was not "a slow march to national health care." On other challenges: Ford said business leaders generally support free trade and open markets. But in contrast to the United States, which Ford described as one of the world's most open markets, Ford said automakers face numerous barriers to sell in other countries.
"All too often, when U.S. automakers try to export or build our vehicles in other countries, we face a different set of rules," Ford said. "There are tariffs, investment restrictions, import quotas, local supplier sourcing rules, currency manipulations and unnecessarily restrictive vehicle standards, to name a few."
Ford said automakers will use the next round of talks on World Trade Organization rules to help open more markets. Business leaders, he said, will only enthusiastically support congressional approval of the trade agreement if it removed the barriers.
Ford said U.S. companies paid out $233 billion in legal costs in 2002, and U.S. companies spend twice as much on lawsuits as companies in other industrial countries.
Ford said business will lead in developing environmentally friendly technologies that will reduce energy use and greenhouse gas emissions, but that government support was crucial.
Ford suggested Congress consider advanced technology tax credits on par with those offered in Japan: about $2,500 to $3,500 per vehicle.
In the long term, Ford said, government development of an infrastructure for hydrogen was a key to converting to ultra-clean fuel cell cars.
"In a related matter, Ford said the automaker will not come to the rescue of troubled Visteon Corp., the auto parts maker spun off from Ford Motor Co. in 2000. Ford said it was up to Visteon management to determine what businesses the auto parts maker should keep, revamp and divest.
Visteon, hampered by high fixed costs, higher material prices and production cuts at Ford that have produced mounting losses, is exploring deep restructuring moves.
"They need to decide, strategically, what businesses they want to be in, where they might not want to be," Bill Ford said.
"We're not Santa Claus."
Ford CEO says rising health costs, fair trade and legal reforms challenge the U.S. economy.
By Jeff Plungis / Detroit News Washington Bureau
WASHINGTON -- Ford Motor Co. CEO Bill Ford Jr. called on the federal government and business leaders Wednesday to find new solutions to rising health-care costs and other challenges that threaten the long-term health of the U.S. manufacturing sector.
In a speech before the U.S. Chamber of Commerce, Ford said rising health care costs, fair trade agreements, legal reforms and government promotion of new technologies are the biggest issues challenging the U.S. economy.
"Some of the key issues are bigger than any one company or any one industry," Ford said. "In order to tackle them effectively, we need the collective action of government and industry working together, to ensure the U.S. remains competitive, and our economy stays strong."
On health care, the biggest drag on the competitiveness of Detroit's automakers, Ford said he hoped the Bush administration and Congress would specifically look at the costs of catastrophic care. Ford spent $3.2 billion on health care last year and faces another steep increase next year.
Ford and other manufacturers have stepped up pleas for relief from rising health care with lawmakers. Recent surveys have shown the sharp rise in health care has made employers reluctant to hire new employees, putting a drag on economic growth.
General Motors Corp. warned investors Wednesday that the automaker's health care tab is forecast to rise an estimated 10 percent in 2005 from an estimated $5.1 billion this year.
Ford said medical malpractice costs - an issue highlighted by President Bush during the campaign - and additional coverage for the uninsured must also be addressed.
After the speech, Ford said it was too soon to go into specifics on initiatives that might help.
"We just had an election, so it's hard to know where the landscape is right now," Ford said. "We'll spend some time over the next few months to get a sense of where Congress is, and then we'll engage in a dialogue. It's way too early to get into any kind of specificity. It's too early on our part, and it's too early on the part of Congress."
Ford said the United States spends more on health care -- $1.7 trillion in 2003 -- than any other nation. Ford's health care costs soared to more than $3.2 billion in 2003, up from $2 billion in 2000. The company spends more on health care -- more than $1,000 per car and truck sold -- than it does on steel.
"This is a pace we cannot sustain," Ford said, but added his call for reform was not "a slow march to national health care." On other challenges: Ford said business leaders generally support free trade and open markets. But in contrast to the United States, which Ford described as one of the world's most open markets, Ford said automakers face numerous barriers to sell in other countries.
"All too often, when U.S. automakers try to export or build our vehicles in other countries, we face a different set of rules," Ford said. "There are tariffs, investment restrictions, import quotas, local supplier sourcing rules, currency manipulations and unnecessarily restrictive vehicle standards, to name a few."
Ford said automakers will use the next round of talks on World Trade Organization rules to help open more markets. Business leaders, he said, will only enthusiastically support congressional approval of the trade agreement if it removed the barriers.
Ford said U.S. companies paid out $233 billion in legal costs in 2002, and U.S. companies spend twice as much on lawsuits as companies in other industrial countries.
Ford said business will lead in developing environmentally friendly technologies that will reduce energy use and greenhouse gas emissions, but that government support was crucial.
Ford suggested Congress consider advanced technology tax credits on par with those offered in Japan: about $2,500 to $3,500 per vehicle.
In the long term, Ford said, government development of an infrastructure for hydrogen was a key to converting to ultra-clean fuel cell cars.
"In a related matter, Ford said the automaker will not come to the rescue of troubled Visteon Corp., the auto parts maker spun off from Ford Motor Co. in 2000. Ford said it was up to Visteon management to determine what businesses the auto parts maker should keep, revamp and divest.
Visteon, hampered by high fixed costs, higher material prices and production cuts at Ford that have produced mounting losses, is exploring deep restructuring moves.
"They need to decide, strategically, what businesses they want to be in, where they might not want to be," Bill Ford said.
"We're not Santa Claus."