Ford takes on driver ed

By: Drivers.com staff

Date: Saturday, 09. December 2006

In what's been described as a "brilliant" move, Ford Motor Company of Dearborn, Michigan have purchased a majority stake in the Hamilton, Canada-based Young Drivers International driver training organization.

"'Brilliant' is a good word for it," says Young Drivers president Peter Christianson. Not only will the partnership enable Ford to sell cars to YD for its instruction fleet, it also gives them an inside track on selling to the more than 51,000 students YD graduates every year through its franchised programs in the U.S., Canada, and Finland. About 41,000 of these are graduated in Canada alone, where YD franchises operate a fleet of over 400 cars.

It wasn't easy to sell a company he had built from a small local organization to an international one with more than CDN$26 million (US$18 million) in revenues, Christianson says. However, the deal with Ford leaves him with a five-year contract as president and an option on five more years. And the deal includes plans for rapid expansion of the YD system.

In addition to the 158 centers YD operates in Canada, it has 25 in the U.S. and 25 in Finland. Christianson forecasts that business in Canada will reach 100,000 graduates within about five years. Internationally, YD is involved in building high-tech training sites in the Middle East and China.

Ford's purchase of YD is part of a vertical integration process it calls "the value chain." In a search for ways to connect with customers and increase sales, Ford has announced purchases of interests in insurance, fuel distribution, car washes, resale operations, and automobile recycling.

Ford bought Kwik-Fit, Europe's largest independent auto maintenance and repair chain for US$1.6 billion, and in April 1999, the company announced intentions to purchase auto junkyards throughout the U.S. It plans to recycle scrap metal and sell recycled parts over the Internet.

Ford Motor Company of Canada's stake in Young Drivers of Canada will enable the auto maker to make contact with prospective customers "during a very formative and impressionable life experience: learning to drive," said Ford Canada president Bobbie Gaunt. Ford plans to open up to 100 YD training centers in dealerships across the country where there is currently no YD presence. This is expected to generate as many as 10,000 extra car sales annually, an increase in business of about 4%.

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