Daniel Howes

Kerkorian motive is cash and ?

If Ford Motor Co. brass could deliver one message to its employees, now that Las Vegas billionaire Kirk Kerkorian is on his way to owning 5.6 percent of the automaker, it’d be two words — calm down.

Good advice, even if those same executives are doing anything but as they huddle with investment bankers, lawyers and key directors. Their job: To war-game what Kerkorian and his lieutenant, Jerry York, might be considering beyond making money on their 120 million-share stake in Ford.

The Dearborn automaker is the third such Detroit target of Kerkorian & York, meaning they have a track record that should, to a point, prove useful in preparing for the future. But Ford, circa 2008, is not where General Motors Corp. was in 2006, and York’s glowing public assessment of Ford CEO Alan Mulally is a startling antithesis to his less-than-charitable take on GM boss Rick Wagoner.

Is ‘forcing change’ all talk?

For all the angst Kerkorian’s sneak-attack investing strikes in the hearts of Detroit auto execs, the historic fact is that the companies he buys are pretty much the same companies when he sells. Meaning his efforts to "force change" end up netting scant results beyond fattening his brokerage account.

Second, the Vegas dealmaker has a losing record in Detroit. In 1995, he and York used Kerk’s stake to mount a hostile takeover of Chrysler Corp. but failed. They acquiesced to the "merger" with Daimler-Benz AG, then sued two years later claiming Kerkorian had been duped and swindled out of a fatter premium. He lost.

Two years ago, Kerkorian took a stake in GM, finagled York a seat on the board and tried to force an alliance with Carlos Ghosn’s Renault-Nissan. They lost; York quit; Kerk sold.

York says the Ford play is all about making money, that Kerkorian is a passive investor who supports Mulally and his team and their strategy. But what, Ford’s management and directors are asking themselves, if they don’t remain passive? They haven’t before.

Seeking big levers, big cash

Will they push to sell Volvo Cars, the money-losing Swedish automaker that would be virtually impossible to dump amid today’s credit markets? No quick boost in value there.

Shut down Mercury, the Ford step-child that Mulally and Bill Ford Jr. before him have been winding down for what feels like forever? Not much dough in killing a brand, just expense and fights with dealers.

Could they suggest emulating GM and spin-off Ford Motor Credit despite fairly compelling evidence — see GMAC, which posted a whopping $598 million first-quarter loss Tuesday — such moves can endanger credit availability and profits for the parent company? Tough call.

Or Ford could just prepare for the worst, assume even the family isn’t off-limits here and go full-throttle on the turnaround because the best defense is a powerful offense.