By on October 1, 2018

Analysts and investors are quick to point out a key similarity between Ford Motor Company’s stock and the terrain between the Appalachians and Outer Banks, viewed from west to east. Unlike Tesla’s recent share price plunge(s), Ford’s decline has been gradual, remaining stubbornly unaffected by the automaker’s attempts to turn it all around.

While he’s faced questions about his performance before, Ford CEO Jim Hackett is growing frustrated with the idea that, under his leadership, the company is focused too much on the future, with not enough going on in the present.

Speaking to Automotive News, which was allowed to freely roam the automaker’s Dearborn HQ, pens in hand, Ford brass were only willing to admit fault when it came to the recent decision to scrap its passenger car fleet. The idea is still sound, the company claims, but it might have been a good idea to loop dealers into the plan.

“We could have spent a little more time explaining why we made the decision, what the ramifications of that would be and the opportunity to allocate that capital into other segments and products, especially with our dealer network,” said global operations head Joe Hinrichs. “We’ve listened, and we’ve learned from that for other announcements that we make.”

Despite analysts’ claims that investors stand to see little in the way of earnings, Hackett remains adamant that everything that could be done to firm up the company’s financial foundation is being done. Some analysts are now beginning to see it his way, he added.

“We’re addressing some long-term issues, and we’re going to do those in very thoughtful and orderly ways — not chaotic ways,” said Hackett. “We’re not in a crisis. The company’s in great shape.”

The automaker’s $11 billion global restructuring is a multi-pronged affair, with the product side of things understandably taking longer to accomplish than the human side. Ford currently finds itself in the uncomfortable period between the announcement of product cancellations (Fiesta, Focus, Fusion, and Taurus) and the arrival of new models (Ranger, Bronco, “Baby Bronco,” unnamed electric crossover). Getting its European operations back to profitability won’t happen overnight, either. Still, Hackett claims there’s movement every day on these works in progress. Nineteen “fitness” (streamlining) projects are ongoing.

Wall Street pessimism is not “as pervasive as represented,” he insists, adding, “It’s why I’m not at all reeling from the criticism, because I know what we’re doing from behind the scenes.”

Kumar Galhotra, Ford’s North American president, apparently renovated the 11th floor of the Glass House to accomodate 13 special rooms, each assigned a particular vehicle line. Galhotra and his team spend an hour in each room, once a week. There are no chairs.

The ability to show what the company’s doing to boost long-term sustainability — and investor confidence — is something Hackett feels should keep him out of the CEO ejection seat. At the moment, Chairman Bill Ford has his back.

“There’s no one I know anywhere within 12 months of a company that’s this old that in that short time is giving some kind of detail that answers every single question I was facing,” Hackett said. “We’re about action now. I’ve made it clear to my team we have to demonstrate results. CEOs’ licenses are extended based on results. I’m not worried that they aren’t there, because all [of] these things we’ve built.”

Is the man too focused on the future of transportation? It’s no secret Hackett likes to go on at length about #FutureCities and #mobility and all things anathema to traditional car lovers. The CEO wants to get across that he can walk and chew gum at the same time.

“There’s a myth that says I’m only worried about the vision stuff,” he said. “I was brought in because I know how to make the two work well — the current business and the evolving state. I would never make it in my last job if all I did was sit around and dream. It’s about designing a business to win.”

All this action will surely keep Hackett’s backside safely removed from the fire in the short term, but only a stock rebound can extinguish the flame.

[Images: Ford Motor Company]

Get the latest TTAC e-Newsletter!

Recommended

24 Comments on “Vision Problems? Ford CEO Says There Aren’t Any...”


  • avatar
    stingray65

    I believe Hackett’s approach to boosting Ford’s stock price has been all wrong. What they need to do for a big jump in price is: 1) immediately drop all gasoline and diesel vehicles and instead build unprofitable green vehicles that are heavily dependent on government subsidies, 2) build said vehicles in tents by employees working 12 hour shifts 6 days per week, 3) frequently tweet promises about great new green vehicles that will be arriving next year, but which don’t actually appear for 3 years, 4) boost investor confidence by appearing on talk shows smoking a big doobie, 5) merge Ford with other money losing green businesses, 6) Move Ford HQ to Silicon Valley area to demonstrate “futurist” mindset. Follow these easy steps and watch Ford stock prices rocket to $200-300 per share in no time.

    • 0 avatar
      JMII

      This approach only works when your other company is successfully launching things into space and landing vertical rockets back on earth to be reused. So just modify your plan to include step 1A) build rocket company. After that the whole vehicle manufacturing thing will seem easy ;)

    • 0 avatar
      raph

      They also need to higher a middle aged Tech Bro! So Ford can catch some of that Tech Bro magnetism!!!

      Of course said Tech Bro needs to have had some hand in the creation of some app or business that improved the lives of the Silicon Valley cult worshipper’s lives somehow convincing them that Tech Bro will save the planet for their progeny and their progeny’s progeny and all will be good with the hucksters on Wall Street all to ready to pump that stock!!!.

  • avatar
    Lie2me

    I want to know what “Ford” is in the first picture, could it be… ??

    • 0 avatar
      raph

      Looks like a Boss 429, can’t tell if its a 69 or 70 model since the person next to the car is blocking the rear quarter and its impossible to tell if it has the side scoop or not.

      IIRC all Boss 429s started out as Mach 1s before being shipped out to Kar Kraft for the modifications necessary for fitting the big mill so unlike the Boss 302 which didn’t get the side scoops in 69 or 70 the Boss 429 did.

    • 0 avatar
      Ce he sin

      It’s a Ranger.
      Ford use those “reversible” plates on most of their European publicity shots – reverse the picture left to right and YHA 108 becomes 801 AHY. You can therefore appear to show lhd and rhd models while minimising photoshoppery.

  • avatar
    cimarron typeR

    Stupid question here. Does an automaker legally have to tell shareholders they’re planning on phasing out a model publicly?
    Why didn’t they just continually refresh the current Fusion and bring over the new Focus, so they don’t appear desperate.I mean how many refreshes has the Charger/300 been through without actually getting a new platform, the 200 just when kablooey in a puff of smoke. I understand axing the Fiesta, as the margin is so tiny on that segment, and luring that segment of buyers really doesn’t build brand loyalty equity in your mark.

  • avatar
    Fred

    Do like many other companies are, buy back stock. Allow employees to buy more stock. Personally outside investors have short term goals. If you really believe in your long term goals you need to take these folks out of the picture.

  • avatar
    Spike_in_Brisbane

    With that headline and photo, I really thought we were about to discuss the inability to see over the hood of an F150. Pity.

  • avatar
    Superdessucke

    Maybe taking a dump on about half of the U.S. auto market will help their stock!

  • avatar

    Hackett = Dead Man Walking. Too bad they can’t get rid if Mr.Lucky Sperm himself, Billy Ford. Mulally was his one lucky moon shot.

  • avatar
    ttacgreg

    Ford is the F-150 company with a side order of Mustangs and Explorers.
    Anybody here have any idea what percentage of Ford’s profit is from F-150s? I guessing better than 50%.

    • 0 avatar
      King of Eldorado

      I don’t know what Ford’s profit on the F-150 has been historically, but going forward, profit on the aluminum-bodied F-150 will depend a lot on what happens with Trump’s ill-conceived tariff on imported aluminum. A story in the news a few days ago said Ford had already lost $1 billion in profit due to the tariff.

  • avatar
    Big Al from Oz

    Ford’s issues are beyond just looking into the future or taking in the present.

    For a couple of reporting seasons now Ford has used commodity prices as an excuse for it’s less than stellar performance.

    The F-150, irrespective of sales numbers and commodity prices the F-150 has cost Ford a sh!tload of money and this debt needs to be paid down. Ford can’t increase the price of the F-150 as the competition in the protected US pickup market has them covered, so Ford will have to live with lower profits.

    I think bringing in the Ranger to the US is long overdue and can help Ford improve profitability.

    Looking at Ford’s recent rationalisation plan shows that Ford isn’t doing well overseas, especially with the dropping of sedans and cars from it’s lineup.

    I do believe if the US changed it’s technical barriers on vehicle imports and adopted the UNECE Global regulations these sedans and cars would still be viable.

    It seems odd that when a motor company like Ford is not performing as many think the percieved default problem is directed at the vehicle lineup, no one has yet to mention Ford’s business model could be antiquated and needs to be restructured.

    An example of forced restructuring and relative success is FCA. Hackett needs to sit down with Ford’s executives and have a really good look at the company and start rationalising the methods they use in the day to day operation of the business. ….. but, like any institution, Hackett needs to overcome internal empire builders and obstructionists.


Back to TopLeave a Reply

You must be logged in to post a comment.

Recent Comments

  • EBFlex: Panasonic wants out. They realize that Tesla is a terrible company run by a guy who is very unstable and a...
  • Nick_515: Man, five full hours of sleep would be so good right now! I sometimes go three weeks with that much, tops....
  • FreedMike: Call a Lexus dealer and give them the VIN – they should be able to look it up. An Audi dealer did it...
  • tomLU86: Mopar Rocker and others, I share your sentiments to a large extent. It’s possible, or probable, that...
  • whynotaztec: I owned a body shop in Mass for several years and saw lots of rust of course. I would usually turn these...

New Car Research

Get a Free Dealer Quote

Staff

  • Contributors

  • Timothy Cain, Canada
  • Matthew Guy, Canada
  • Ronnie Schreiber, United States
  • Bozi Tatarevic, United States
  • Chris Tonn, United States
  • Corey Lewis, United States
  • Mark Baruth, United States
  • Moderators

  • Adam Tonge, United States
  • Corey Lewis, United States