By on May 10, 2017

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The board of directors at Ford Motor Company will be seeking answers from CEO Mark Fields on how the brand’s mobility strategy played a role in its lackluster annual earnings report. Inside sources claim board members made extra time leading up to Thursday’s annual shareholders meeting to discuss the company’s future with the CEO.

Fields has promoted Ford’s evolution into a mobility company ever since taking the helm in 2014 — something investors haven’t been particularly receptive of. During Fields’ tenure as CEO, shares in the company have fallen by 35 percent. However, with tech-focused companies typically receiving above-average valuations, the methodology behind his strategy appears sound. Ford has spent billions on the development of autonomous technology and showcased mobility concepts that even Tesla hasn’t bothered with.

While many seem too impractical or far-fetched to deserve serious attention, the capital behind its self-driving efforts have kept Ford near the front of the pack in the autonomous race. So, what’s the problem? 

That’s what the board is hoping to find out. Ford splitting its role as a traditional automaker and ultra-modern mobility company could be part of the problem. First quarter earnings fell 42 percent in the first quarter, while General Motors has seen comparatively stable profits. However, GM is also playing the mobility game — just not quite as loudly as Ford. General Motors has also focused more on its current product and distribution than the Blue Oval. It has fielded more purpose-built EVs and dominates the domestic SUV market, giving it an advantage.

“GM has been a bit more aggressive in pure electric cars and on car-sharing and ride-hailing with their investment in Lyft,” said David Whiston, an analyst with Morningstar Inc.

Meanwhile, Ford is attempting to hold its ground while looking further into the future. “We’re having one foot in today and one foot in tomorrow,” Fields told Bloomberg in April.

Still, focusing so heavily on the future doesn’t seem to be helping the Ford of today. The company almost appears to be setting itself up for success ten years from now at the expense of the next three. It’s uncharacteristic of a century-old automaker and not everyone has been receptive, investors least of all.

“This is the first public sign that the board is becoming impatient,” Whiston said. “It’s likely proof that the board is frustrated with the stock price languishing for the past several years. It may be a grilling session for Mark.”

[Image: Ford Motor Company]

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21 Comments on “Ford Board to Grill Fields on Mobility Strategy After a Sucky First Quarter...”

  • avatar

    anyone who was around from 2006-2009 who thinks a $2bn quarterly profit is “sucky” really, really needs to re-set their expectations. But they’re too busy propping up the share price of Twitter, which has never made a dime and doesn’t have any clear path to profitability.

  • avatar
    Car Guy

    In the past 2 years, Ford has made about $20 billion in profit. It’s amazing the stock price is going nowhere and Tesla, who has never made a dime, is so astronomically high.

    • 0 avatar
      Adam Tonge

      It hasn’t gone above $20/share since 2001. Post recession, it has rarely crested $15/share. Meanwhile, the JPMorgan Chase stock I bought in 2008-2011 for cheap is at $85/share.

  • avatar
    Adam Tonge

    “MOAR SUVS!!!!!”

    -Ford Investors-

  • avatar

    Public corporations can’t see beyond a quarter.

  • avatar

    As they should. Ford seems to be trying to compete with Silicon Valley tech startups and Tesla regarding ride and bike sharing of late more than cars. It doesn’t make sense. I kinda feel like they are sort of forcing these things on people to make it seem like this is what the future is and this is what people want, and that really isn’t the case.

    • 0 avatar

      you don’t see the point? Investors look for growth potential; Tesla has made almost no money but their stock price reflects investors’ hopes they’ll grow substantially and eventually start making money.

      the existing automakers don’t really have anywhere to grow in their traditional market (cars, trucks/SUVs.) They really can only give and take a bit of marketshare from each other every quarter, and sales trends are declining across the industry.

      the short-sighted part is investors complaining about spending money on other markets. If they want growth, that’s what the company is going to have to do.

      “I kinda feel like they are sort of forcing these things on people to make it seem like this is what the future is and this is what people want, and that really isn’t the case.”

      It may not be what car enthusiasts want (as reflected by your login name) but the simple fact is enthusiasts are a small fraction of the market, and we don’t speak for the majority of people buying the 15 to 17 million vehicles every year.

      • 0 avatar

        Yes investors look for growth potential, but that doesn’t always mean they look in the right places. And they may be looking too far down the road. To reference both your points, recent studies have shown most people don’t fully tryst autonomy in vehicles. Ford and other automakers seem to be pushing forward with it regardless of public opinion. You cant tout something as the future and gamble on it if people aren’t accepting of it. They just need to take it slow and read the market. Not jam it down peoples throats. If people want it they will come.

        • 0 avatar

          “Not jam it down peoples throats. If people want it they will come.”

          who’s jamming what down people’s throats?

          • 0 avatar

            “recent studies have shown most people don’t fully tryst autonomy in vehicles.”

            One you get to full automation, I’m betting that other than big limo’s, trysts will increase.

  • avatar

    I work at Ford as a low level employee. $1 billion Argo investment, $65 million Chariot investment, $200 million Pivotal investment, etc., don’t seem very prudent to me. A lot of my colleagues share my sentiment.

  • avatar

    Ford has a marketing problem. When you think “autonomous tech” ,the blue oval ain’t exactly the first image to mind. It doesn’t help that Ford is doing this right-test the tech long term and doesn’t make the customers guinea pigs.

  • avatar

    Ford is forced to play the autonomy game, both for competitive reasons as well as PR. Regardless of whether autonomy goes anywhere, no automaker can be seen as being left behind. A lot of wasted money.

    Ford’s big problem is an aging model lineup. The Taurus came out in 2010 and has had 1 mild refresh, the Fiesta in 2011 with 1 mild refresh, the Focus in 2012 with 1 mild refresh and the Fusion in 2013 with 1 mild refresh. Same with the Explorer and Escape. They have a stale lineup right now. Yes, replacements are coming, but not for another year or 2. GM has a fresher lineup overall, and is reaping the benefits of it. It seems like Ford pushed out the replacements for pretty much everything 1-2 years and put that money into autonomy and EV tech (which we also haven’t seen the results of yet).

    I sold most of my Ford stock over a year ago, because I could see that it was going nowhere. Glad I did.

    • 0 avatar

      There’s no money for Ford making cars – the f150 is the key, and they have done well with it. If you assume GM will do better with their new trucks and that the auto market is turning down, not much Ford can do but expect a falling stock price. The only potential,source for any upside is growing high margin Lincoln sales in places like china.

      I don’t know about the rush to automated vehicles – doesn’t seem like there is much reason for any one firm to get their first, unless you think there will be one winning technology, and that the rest of the firms will have to license it.

      • 0 avatar

        “the f150 is the key”

        The F150 has been the key for a long time, and will remain the cashcow at Ford for as long as gas stays cheap.

        More V8s!

      • 0 avatar

        True and they do not sell well as well. Ford is currently7 th in Global rankings and seemingly going backwards. GM is going backwards faster, but that is a different matter.
        Ford has quality control and a dearth of product problems. Fields needs to address the ” bread and butter” problems before chasing pie in the sky Mobility solutions.

  • avatar

    Equivalent headline from 1907:

    “Amalgamated Buggywhip and Bridle Company board questions CEO for questionable ‘horseless carriage’ ventures”

  • avatar

    While I wouldn’t call it a mobility issue, the Escape would greatly benefit if it had the Fusion’s hybrid drivetrain.

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