6 Friday, August 28,1981
THE DETROIT JEWISH NEWS
Ford Motor Co. Continues to Repudiate Arab Boycott
(Continued from Page 1)
companies are caught up in
an extremely sensitive
political problem not of
their making and totally
beyond their ability to
influence.
"Ford Motor Co. has no
wish to become involved-
on either side of the
Arab-Israeli - dispute.
This is an issue properly
the responsibility of gov-
ernments, not private
companies. Our interest
is to serve the vehicle
needs of all of the coun-
tries of the Middle East,
without regard to poli-
tics, or conflicts between
or among those coun-
tries. Presently, in Israel,
we are selling commer-
cial vehicles in kit form,
via an Israeli-owned
distributor/assembler.
"Without changing exist-
ing methods of conducting
business, Ford would like to
find ways to participate
fully in the expanding mar-
kets of this region. Present
U.S. laws and regulations,
however, prohibit meaning-
ful contact on the boycott
with grab officials. Merely
to reply to the Boycott
Office's standard question-
naire, for example, would
subject Ford Motor Co. to
criminal penalties. These
include possible fines up to
$50,000, prison terms up to
five years and the suspen-
sion of all export licensing
privileges for export from
the U.S. to any country in
the world.-
"So what is the Ford posi-
tion vis-a-vis the boycott? In
a nutshell, we have been
blacklisted for 15 years, are
frozen out of a rapidly grow-
ing vehicle market and
would like to find ways to
serve both Israel and the
various Arab nations with
quality Ford cars, trucks
and tractors. Existing laws
in the U.S. prohibit even the
first steps in this direction."
In a supplementary
statement, Robert T. Hefty
director, international anti
diversified products, public
relations office of Ford
Motor public affairs, indi-
cated that Israeli dis-
tributors continue their ac-
tivities in behalf of Ford in
Israel, listing the Arab
states that have similar re-
lationships and those
adhering. to-the boycott.
"There is little we can
add to Mr. Holloway's
July 29th letter to you re-
garding the Ford view of
the Arab boycott. Ford
sales to the Israeli
distributor/assembler
continue as before, sub-
ject to normal business
conditions. A very small
volume of Ford vehicles
— fewer than 2,000 units
annually — is sold in
Egypt, Morocco and
Tunisia. This is a com-
bined figure for all three
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markets. All other Arab
countries presently
boycott Ford vehicles,
with the result that these
markets remain closed to
us."
Henry Ford II personally
emphasized the Ford resis-
tance to the Arab League
boycott and the company's
rejection of the boycott
threats in a statement to
Philip Slomovitz, editor of
The Jewish News, in. April
1970,-81 a luncheon meeting
at his office in Dearborn.
Attending that luncheon
were Slomovitz; Boris Smo-
lar of the Jewish Tele-
graphic Agency; Raphael
Levy, Max Fisher's public
relations adviser on United
Jewish Appeal affairs; Wal-
ter T. Murphy, executive di-
rector of the Ford public re-
lations staff; and Allen W.
Merrell, a Ford Motor Co.
vice president.
Slomovitz reported at
that , time: "The Arab
boycott of Israel, and there-
fore of firms that do busi-
ness with Israel, inevitably
became a subject of discus-
sion during the lunch, and
Ford calmly reasserted that
he would not be pressured
into an act of injustice by
anyone. The Ford plant in
Cairo had been confiscated
by Egypt, and the Ford
market was seriously af-
fected by the Arab act, Ford
explained that only the
truck trade with Jordan
remains unaffected by the
boycott.
"Additionally, another
Moslem country, Iran, con-
tinues to trade with the
Ford Motor Co-. Its pur-
chases are minimal because
of the smallness of the coun-
try, and it is well known
that Iran is not part of the
Arab bloc. Iran, ancient
Persia, has good relations
with Israel, and Iranian
Jewry functions uncom-
plainingly.
"The only factor that
troubled Ford about the
boycott is that it caused
great hurt to the Ford
dealers in Egypt. He
spoke of the dealers as
being innocent victims in
the evolving situation be-
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cause they are unable to
secure parts for the cars
on hand and are sub-
jected to the harm im-
posed upon them by the
boycott."
In "The Public Image
of Henry Ford" (Wayne
State University Press),
Dr. David L. Lewis, now
professor of business his-
tory in the Graduate
School of Business Ad-
ministration at the Uni-
versity of Michigan, had
this explanatory analysis
of Henry Ford II's atti-
tude on Israel and his
company's policies on the
boycott:
"To the new and unstable
state of Israel, Ford in 1949
extended the most liberal
credit terms ever offered to
a buyer of Ford trucks. Dur-
ing the 1950s the company
began exporting passenger
cars to Israel from the
United States, England,
and Germany.
"The 13-member Arab
League, which in 1951 set
up a Boycott Office to
monitor and blacklist firms
doing business with Israel,
protested Ford's coopera-
tion with the Jewish state,
but stopped short of declar-
ing a boycott of the corn-
pany's products. The Arab
League also expressed dis-
approval of the Ford Com-
pany's gifts of funds and
equipment to Israel's
Weizmann Institute of Sci-
ence, Hebrew University
and Technion and Henry
Ford II's personal gifts to
the ,United Jewish Appeal.
"Executives of Ford
Overseas Automotive
,Operations (OAO) which
administered an assem-
bly plant in Alexandria,
Egypt, a dealer assembly
operation in Casablanca,
Morocco, and
dealerships throughout
the Arab world — repre-
senting a company-
dealer investment of
$60,000,000 — pleaded
with Henry II to soft-
pedal his personal con-
tributions to Jewish
causes and requested
permission for the com-
pany to donate an equal
sum to the United Na-
tions Relief and Works
Agency for Palestine
Refugees.
"The OAO officials also
asked Henry II to resist
mounting pressure from
American Jewish and Is-
raeli leaders to set up a
dealer assembly plant for
trucks and tractors in Is-
rael. The company, argued
the executives, outsold all
rivals in the Arab world,
and should not sacrifice an-
nual sales of 20,000 to
22,000 units for one-tenth
that number of Israeli sales.
"Henry II" endorsed a
matching company dona-
tion to the refugee agency, a
gift which was publicized in
Arab nations, but not in the
United States, for fear of of-
fending American Jews.
Henry II insisted, however,
on pushing ahead with
plans for Israeli expansion,
and sent technicians to the
Jewish state to start up a
dealer assembly plant for
knocked-down vehicles.
" 'Ford,' a spokesman for
an American Jewish organ-
ization said later, 'was
thinking of the market in
Brooklyn, not Tel Aviv.'
Henry II's decision to ex-
pand in Israel, in the fact of
Arab threats, evoked hun-
dreds of letters of apprecia-
tion from Jews around the
world and a barrage of
favorable editorials in the
Jewish press.
"Although committed
to Israeli expansion, the
company tried vainly to
appease the Arab
League, offering, accord-
ing to the Jewish Tele-
graphic Agency to export
cars and trucks from
Egypt to help_ that coun-
try earn foreign cur-
rency. Ford also declared
that it would not invest
`one cent in operations
inside Israel,' and
claimed that its expan-
sion was more a matter of
degree than of principle."
"The firm noted that its
trucks had always been
shipped to Israel in a semi-
knocked-down state to save
on transport costs; its Is-
raeli dealer had always as-
sembled parts. The dealer,
said the company, now
wanted to assemble com-
pletely knocked-dowh units
to avoid payment of a new
Israeli tax of 180 percent on
fully assembled imports.
"Ford's plea was rejected
by the league, which on
Nov. 20, 1966, declared a
boycott of Ford vehicles and
Ford-Philco television re-
ceivers, refrigerators and
air conditioners — a ban
which remains in effect and
shows no sign of being re-
scinded.
"Ford's Egyptian plant
and Moroccan facility, fi-
nanced by Moroccans, were
closed; and its dealers, un-
able to obtain new vehicles
and parts, were phased out.
The company lost an esti-
mated $200,000,000 in sales
during the first three years
of the boycott, according to
Mohammed Mahjoub,
commissioner-general of
the Boycott Office.
In contrast, General
Motors, which had ex-
ported cars and trucks to
Israel since the late 1940s
and privately informed
Arab leaders that it had
no intention of establish-
ing an assembly opera-
tion in Israel, went on to
increase its sales to Arab
countries. In 1974, Gen-
eral Motors sold approx-
imately 2,000 cars and
trucks in Israel, approx-
imately 30,000 in Arab
states.
"Henry Ford II never wa-
vered in his decision to for-
sake the increasingly lucra-
tive Arab market for Israel,
and American Jewry. In
1967, he permitted his com-
pany to accept an award of
merit from the American-
Israel Chamber of Com-
merce and Industry for its
decision to assemble ve-
hicles in Israel. 'That is all
we need,' a Ford overseas
executive groaned at the
time.
"Three years later Henry
II told a delegation of
Jewish visitors to his office
that his only regret over his
decision was 'the harm im-
posed on Ford's Arab
dealers who were innocent
victims.'
"In 1972, Ford visited his
company's Nazareth as-
sembly plant, whose 1,200
employees built commercial
vehicles and the Escort car.
`I have been a friend of Is-
rael for many years,' Henry
II told Transport Minister
Shimon Peres, 'and aft, y
visit here, I am even -
ger friend.'
The boycott of Ford
took on a new dimension
in 1975, when Henry II vi-
sited London's money
market in search of Arab
financing for Detroit's
Ford Co. sponsored Re-
naissance Center, a huge
hotel-office-apartment
complex. The Arabs,
pointing to the inclusion
of Ford's name on their
blacklist, summarily re-
jected the company
chairman's appeal.
The Ford Motor Co.'s car
sales assumed extensive
proportions in Egypt prior
to the Camp David agree-
ments, thus emphasizing
that the Arab League
boycott did not have
unanimous support in Arab
ranks. In an article in the
Christian Science Monitor
on Nov. 1, 1977, staff corre-
spondent John K. Cooley
wrote: •
"The Ford. Motor Co.'s
$130 million deal signed
with Egypt Oct. 29 might be
a ticket back into the Arab
world for Ford and other
companies blacklisted by
the Arab boycott of Israel. •
"After two years of
negotiations, Ford and the
Egyptian government
agreed on reactivation of
Ford's old assmebly line in
Alexandria to produce
10,000 trucks a year and
construction of a new plant
to build 5,000 diesel engines
annually.
"The Ford project
would provide 17,000
jobs in Egypt and exports
worth 190 million a year,
said an Egyptian gov-
ernment spokesman
quoted by Cairo radio.
- "Ford's Alexandria plant
ceased production in 1966
when the Arab boycott of Is-
rael office blacklisted Ford
for building a plant in
Nazareth, Israel. Since
then, - the Alexandria plant
has performed only repair
and maintenance functions.
Blacklisting has kept Ford
products out of most -' 1-s r
Arab countries.
"Like the Coca-Lola
Corp., also blacklisted by
the boycott office since 1967
and which signed a joint cit-
rus venture with Egypt in
September, Ford says it
hopes the investment in
Egypt will persuade the
Arab boycott office to re-
move it from the blacklist at
the office's next meeting in
November. However, it
plans to go ahead in Egypt
whether or not it is removed
from the Arab League's
blacklist."
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