 "Ford Motor")
Ford Motor Co on Friday named top executive Jim Farley its chief operating officer, positioning him as potential heir to Chief Executive Jim Hackett and shaking up its top management three days after a weak 2020 profit outlook.
Farley, president of new businesses, technology and strategy, has been viewed as one of the potential successors to Hackett, who took over in May 2017. News of his promotion and another perceived rival's retirement, effective on March 1, came in the same week the No. 2 U.S. automaker saw its shares slide following the disappointing forecast.
Ford is in the midst of a global restructuring as well as slumping demand in China, its second largest market, and Hackett said repeatedly on a conference call that the Dearborn, Michigan-based company needs to move with greater speed.
"It's my judgment the time is to move with urgency now to fully integrate and accelerate Ford's transformation," he said.
"We're now in execution mode and what the company needs is to come together," Hackett added, saying he had no plans to leave the company after almost three years on the job.
By Ford's own accounting, its restructuring is far from complete. It said on Tuesday it has booked $3.7 billion of the projected $11 billion in charges it previously said it would take, and expects to book another $900 million to $1.4 billion this year.
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In China, Ford lost $771 million last year, about half the 2018 loss, and its market share there has shrunk to 2% from 2.3% the year before. Ford has been struggling to revive sales there since its business began slumping in late 2017, and now the world's largest market has been hit by a fast-spreading coronavirus that has killed more than 630 people.
"We have all the pieces in place now for China to be a profit improvement story," Farley said.
Another key element for 2020 is Ford's planned introduction later this year of a fully redesigned F-150 full-sized pickup truck, its top profit generator, as well as the Mustang Mach-E electric SUV and the Ford Bronco utility vehicle.
Farley, 57, joined Ford in 2007 as global head of marketing and sales and went on to lead Lincoln, South America, Ford of Europe and all of Ford's global markets in successive roles. He previously worked at Toyota Motor Corp.
"We have all the foundation elements of this transformation, so now it's go time - execution," he said.
Farley is credited, along with Hackett, in forcing the redesign before its introduction of the Mustang Mach-E electric SUV and the decision to make it a Mustang vehicle, leveraging that iconic brand. Farley has owned seven of the cars starting with a 1965 model he restored when he was 14 years old.
Hackett, 64, also said Friday that Joe Hinrichs, president of automotive, will retire. Many employees and outside observers had seen him as a favorite to succeed Hackett, but the company had been criticized recently for a poor launch of its new Ford Explorer SUV and rising warranty costs.
Hackett said Hinrichs' retirement was not tied to any of those issues.
Ford said in regulatory filings that in addition to his regular compensation, Hinrichs will receive payments equal to two years of his annual salary, paid in monthly installments, as well as an enhanced retirement package. Those monthly payments will cease if he is hired by another company.
Another executive, Hau Thai-Tang, 53, received additional responsibilities. He will continue to lead product development and purchasing, while adding responsibilities for enterprise product line management and connectivity. Thai-Tang will report to Farley.
