MARK FIELDS

Ford Management Overhaul: Fields Out, Hackett In

May 22, 2017 by admin Leave a Comment

Management shakeup at the top as stock prices slide.

Following a board meeting this past Friday, the Ford Motor Company set in motion changes to senior management confirmed only this morning.

CEO Mark Fields is out, Jim Hackett has taken his place, and three new roles for current Ford executives were announced. Also, long time Ford communications head Ray Day will retire in 2018 with Mark Truby replacing him.

Hackett is the former CEO of Steelcase, a leading office furniture company. Besides modernizing Steelcase, Hackett served as the interim athletic director at the University of Michigan, bringing venerated football coach Jim Harbaugh to Ann Arbor. That move received praise from fans and has helped reinvigorate the program.

From Board Member to Mobility Boss

Hackett joined Ford’s board of directors in 2013, later named the chairman of the newly formed Ford Smart Mobility in March 2016. Bill Ford is a fan of Hackett and the two appeared together at a news conference this morning at Ford’s Dearborn headquarters to discuss the changes.

These changes mean Mark Field has retired, following a distinguished 28-year career at Ford. Fields, now retired, succeeded Alan Mulally as the company’s president in CEO beginning in July 2014. Prior to that, he served as the company’s chief operating officer, executive vice president, and chairman of the automaker’s Premier Automotive Group. Early on he ran marketing and sales for Ford’s former Mazda subsidiary and also managed Ford’s Argentina operation.

In Mulally’s Steps

But Fields came in behind Mulally, who has been widely credited with saving Ford from bankruptcy. Unlike its chief US competitors GM and Chrysler, Ford had a large cash fund in place when the market nosedived in 2008. Essentially, Mulally hocked the house to create Ford’s war chest. That debt has since been paid off.

Mulally also instituted the company’s “One Ford” policy, where the automaker began offering its products globally instead of regionally. Thus, the European Ford Focus came to the US market, while the Mustang sports car’s range extended to new markets, including Europe. Today, more than 100 markets offer the Ford Mustang.

To his credit, Fields oversaw record profits and operating margins over the past few years. For instance, the company made a record $2.5 billion net profit in the first quarter of 2016 — more profit than any quarter in Ford’s now 114-year history.

But profits are only one indicator of corporate success. Unfortunately, Ford’s stock price has fallen by 40 percent under Fields. At the most recent annual shareholder meeting earlier this month, shareholders pressed Fields and Chairman Bill Ford to explain why shares have plummeted. Further aggravating shareholders were the strong bonuses awarded to Fields and other executives as share prices tumbled. Clearly, shareholder disgruntlement and board angst led to the changes we learned about today.

Three Appointments Effective June 1

Besides Hackett stepping in, Ford announced three other personnel changes effective June 1.

Firstly, Jim Farley is now the executive vice president and president of Global Markets, overseeing Ford’s business units in much of the world. In addition, Farley will oversee the Lincoln Motor Company along with global marketing sales and services.

Secondly, Joe Hinrichs is appointed executive vice president and president of Global Operations. This means Hinrichs will oversee the company’s product development, manufacturing and labor affairs, quality, purchasing, and sustainability efforts, along with environmental and safety engineering.

Thirdly, Marcy Klevorn is now the executive vice president and president of Ford Smart Mobility LLC, replacing Hackett. The subsidiary was formed to accelerate the company’s plans to design, build, grow and invest in emerging mobility service along with advancing changes to Information Technology and Global Data.

“We are fortunate to have three dynamic and talented leaders in Jim Farley, Joe Hinrichs and Marcy Klevorn taking on greater responsibility,” Bill Ford said. “Each has a track record of driving innovation, cost efficiency and delivering results around the world. They will work closely with Jim Hackett to lead Ford’s day-to-day operations, build our brand and capitalize on emerging opportunities.”

Three Priorities

Hackett and Bill Ford will focus on three priorities moving forward, defining these as:

1), sharpening operational execution,

2), modernizing Ford’s business, and

3), transforming the company to meet future challenges.

Besides the immediate challenges of convincing Wall Street to boost Ford stock, the automaker must also face a tightening market. US sales are down year to date as analysts indicate peak sales were reached in 2017.

Like its competitors, Ford must exercise discipline and avoid deep discounting, what can only hurt its bottom line.

Photo courtesy of the Ford Motor Company.

LA Auto Show Now Includes AutoMobility LA

May 20, 2016 by admin Leave a Comment

New Technology Pavilion launches this year.

The 2016 Los Angeles Auto Show adds a new component, AutoMobility LA, a four-day trade show in advance of the usual 10-day consumer auto show. In effect, the LA Auto Show is combining the show’s press and trade days with its previous Connected Car Expo (CCE) to launch AutoMobility LA.

Four-Day AutoMobility LA

The inaugural AutoMobility LA event will be held from November 14-17, then followed immediately by the LA Auto Show from November 18-27.

Automobility Los Angeles Auto Show

Designed exclusively for the auto industry, the trade show will pull together what show officials say is the “entire ‘new mobility ecosystem’ comprised of automakers, tech companies, designers, developers, startups, investors, dealers, government officials, analysts, etc. – to redefine and unveil the future of transportation.”

Held at the Los Angeles Convention Center along with the LA Auto Show, AutoMobility LA will include a new 50,000-square-foot Technology Pavilion building currently under construction, effectively doubling the number of auto-tech exhibits over 2015’s CCE.

Keynote Speaker: Ford’s Mark Fields

The show’s organizers say that leading car manufacturers and technology kingpins both have already signed on to make major announcements during AutoMobility LA. Mark Fields, President and Chief Executive Officer of Ford Motor Company, will deliver the opening AutoMobility LA keynote address on the second day of the trade event.

Previously, a number of CCE exhibitors received important financial backing following the show. Notably, a $500 million investment from General Motors in the ride-share company Lyft was announced, representing the largest investment by a car manufacturer in such a venture to date.

“For years, we’ve been at the epicenter of the changing automotive industry, creating a setting for some of the largest partnerships such as that between General Motors and Lyft,” said AutoMobility LA and LA Auto Show President and Chief Executive Officer, Lisa Kaz. “We’re excited to continue to connect brands, whether established or start-up, with influential people and provide engaging experiences with the world’s leading companies.”

Networking, Press Conferences, and Learning Opportunities

The schedule for AutoMobility LA includes four days of networking, three days of press conferences and two days of learning opportunities such as presentations by a diverse range of experts. A complete list of panel topics and speakers will be announced in the near future. Meanwhile, a draft schedule can be found at http://www.laautoshow.com/automobility.

Companies already committed to this year’s show include ATMO Auto Power, Continental International, Garmin International, Mocana, QNX and whiteCryption. Returning sponsors include Global Automakers, KPMG, Mojio, State Farm and Pirelli.

AutoMobility LA will feature more than 50 world and North American product debuts over the course of the show. In addition, the show will feature panels, noteworthy presentations by executives, technology exhibits, car manufacturer displays, networking events and news breaking conferences that will investigate all facets of the swiftly changing automotive and new mobility industry.

Hackathon and GO

Other events related to the show include a 36-hour hackathon immediately preceding AutoMobility LA whereby developers, designers and entrepreneurs will deliberate, concoct and market connected car apps and services that mobilize Mojio’s open platform and partner APIs.

Further, during the LA Auto Shows’ consumer days, will be GO, described as an all-new destination featuring car manufacturers’ and newcomers’ latest smart mobility devices and apps that are redefining personal mobility. Located with the L.A. Convention Center, GO will feature e-kick bikes, hover-boards, wearables and much more.

Auto Trends will share additional information about this year’s show as it becomes known. Please check out our electric vehicles section for related stories and information.

To register for AutoMobility LA, please visit: http://laautoshow.com/join (starting July 2016).

Recent News — Cadillac House Serves Coffee, Not Cars

Logo copyright the Los Angeles Auto Show.

Ford Designates $1.8 Billion for China

October 12, 2015 by admin 1 Comment

Automotive sales have cooled in China, but the Ford Motor Company still sees much potential for expanded opportunity in the world’s largest consumer market. Today, the automaker announced plans to invest $1.8 billion to bolster research and development in China.

The investment comes as Ford seeks a greater share of the lucrative Chinese automotive market led by Volkswagen and General Motors. In recent years, Ford has seen its market share increase even as manufacturers such as Toyota and Honda find the going tough. At present, Ford is in fifth place with Volkswagen, GM, Hyundai and Nissan in front.

Smart Car Technologies

Ford’s investment will provide funds to push for increased smartphone integration, vehicle autonomy and other so-called “smart car” technologies designed specifically for the Chinese market. In particular, the automaker is eyeing smartphone features that give drivers more control over their car systems by means of mobile chat. Ford’s Sync 3 system will play an important role in that endeavor when it is released next year, building on its current telematics initiative.

Ford Chief Executive Mark Fields disclosed the investment at a corporate event in Shanghai. He also declared that Ford will advance vehicle electrification in China by introducing its plug-in hybrid electric vehicle, the C-MAX Energi, as well as its Mondeo conventional hybrid. The Mondeo is sold as the Ford Fusion in North America.

“At Ford Motor Company, our goal is to make people’s lives better,” said Mark Fields, president and CEO, Ford Motor Company. “As both a product and mobility company, we are driving innovation in every part of our business. The result here in China will be a positive change for consumers in the way people move, the way they drive, the cities they live in and the communities in which we operate.

Pollution and Traffic Woes

The Chinese government has been pushing for vehicle electrification in a bid to reduce pollution, but the process has been slow due to a deficient infrastructure. Nevertheless, car manufacturers are responding to the push by introducing hybrids and pure electric vehicles.

Another problem besetting China is traffic. Despite just one in 10 consumers owning a vehicle (compared to eight in 10 in the US), the country’s traffic problems are enormous. Indeed, a highly publicized 50-lane traffic jam earlier this month following a week-long National Day break showed just how out of control the problem is with tens of thousands of drivers affected. Although certainly not a manufacturer problem, traffic woes can adversely affect consumer purchase decisions.

Passenger and Commercial Vehicle Partners

Ford sells its cars through two partners — Changan Ford Automobile (passenger vehicles) and Jiangling Motors Corporation (commercial vehicles). In August, the last month sales figured were published, the two partners combined to sell 79,608 vehicles, down three percent compared to the same time last year.

Ford’s China sales are down one percent year to date through August on just over 700,000 vehicles sold. In comparison, Ford’s US sales were up three percent through August on 1.685 million units sold.

Lincoln in China

Besides the Ford brand, the automaker has been touting its Lincoln marque in China. Lincoln got started in China only last year, introducing its compact MKC crossover and the entry-level MKZ sedan to consumers first. Two additional products, the midsize MKX crossover and the full-size Navigator SUV, are on tap for release this fall.

Although Lincoln’s Chinese footprint is small, it is making use of the Internet to reach customers through its virtual “The Lincoln Way” website, what tells the brand’s story to potential customers, especially for those without current access to Lincoln stores. This effort is designed to help educate customers as well as to enable dealers to build their customer base.

Photo copyright the Ford Motor Company.

Ford Bets $5 Billion on Lincoln

October 30, 2014 by admin Leave a Comment

Lincoln gets another lease on life.

2015 Lincoln MKZ. — This Lincoln MKZ is just one example of a Ford-based model.

Ford’s Lincoln brand may have some life left in it after all. Last week, Reuters reported that Ford has committed to invest at least $5 billion in Lincoln over the next several years as well as to introduce an all-new modular platform for the brand and for select Ford products. Reuters also said that its previous CEO, Alan Mulally had considered shutting Lincoln or selling it. The new boss, Mark Fields, plans to revive Lincoln and has gained the backing of Bill Ford and other board members to carry out the initiative.

Lincoln Motor Company

The Lincoln Motor Company, purchased by Ford in 1922 and championed as the company’s luxury brand, has seen good times and bad times. The good times were as recently as 1998 when Lincoln held the top spot among luxury makes in the United States. Today, Lincoln sells far fewer models and is in eighth place, selling about half as many cars as its arch-rival, Cadillac.

Much of that neglect can be found in two areas: financial support and products.

Financially, the Ford Motor Company has provided $500 million or less in annual support. That amount covers all expenditures, including product development, engineering, tooling, facilities and related costs. Introducing a new platform alone typically costs at least $1 billion.

Ford, Lincoln Product Similarities

As for product, Ford has kept Lincoln’s costs to a minimum by building models that are based on Ford platforms. Look at any Lincoln product and there is a corresponding Ford model. For instance, the Lincoln Navigator and Ford Expedition are similar as are the MKX crossover and the Ford Edge. Over the past few years Ford has sought some differentiation, but the Lincoln MKZ is still closely related to the Ford Fusion. One of its most recent new models, the MKC crossover, is built on the Ford Escape’s platform. But at least it has its own skin and interior.

News of Ford’s additional investment in Lincoln follows the brand’s introduction to the Chinese market, with the first customer deliveries having already occurred this month. The United States and China will likely be Lincoln’s two largest markets going forward, with Ford estimating 300,000 annual global sales by 2020, an ambitious number that would nearly triple sales within five years.

D6 Modular Platform

The modular premium platform (dubbed D6) Ford has in mind for Lincoln would produce front-, rear- and all-wheel drive vehicles. Likely, its introduction is at least five years away and that means the current model line would be revived once before any new models roll out. Reuters says that the first model would be a midsize sedan followed by a crossover. That could mean replacements for the MKZ and MKT, the latter based on the platform underpinning the Ford Flex.

In the interim, replacements for the MKX crossover and MKS sedan will arrive in early 2015 and in early 2016 respectively. A stretched wheelbase version of the MKS is in the offing too, but is slated for the Chinese market only. Message board comments from Lincoln dealers and supporters expressed dismay that the US market isn’t being considered for the stretched model, underscoring what some see as continued neglect for the brand.

After all, with the Lincoln Town Car no longer produced, there is no model to fill its place. Lincoln has attempted to do so with the MKT crossover, but that effort has failed.

The Competitor Factor

That Ford wants to make good on its Lincoln revival is a step in the right direction. Whether it pulls it off is another matter, especially as its competitors continue to grow and produce the types of vehicles customers want.