The Sumitomo Bank–led Ford capital tie-up and rescue (1979)

Abandoning self-rescue to choose the umbrella of capital

What made this decision unusual is that, though it was the turnaround of a financial crisis, the one in command was not Toyo Kogyo itself but its main bank, Sumitomo Bank. Because the company was inseparable from the Hiroshima economy it could not be allowed to fail; Sumitomo Bank took an expansionary line at a moment that called for retrenchment, and led the rescue with all-around groundwork, from ousting Matsuda to bringing Ford back to the table. The choice of releasing shares to foreign capital, rather than a self-led rebuild or a merger with a peer, gives this rescue a character unlike others.

This tie-up was also the start of thirty-six years under Ford’s wing. Accepting foreign capital in exchange for survival on the world market can be called a realistic answer for a subscale, standalone maker trying to live on. Yet subordination to Ford would be maximized by the seizure of control in 1996, and after the retreat from 2008 and the unwinding of capital in 2015, the capital structure would be reworked into the equal tie-up with Toyota in 2017. Accept control or keep autonomy — the question over which Mazda would long waver was first posed by this 1979 decision.