Vision Problems? Ford CEO Says There Aren't Any

Steph Willems
by Steph Willems
vision problems ford ceo says there aren t any

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 and 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]

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4 of 24 comments
  • Ttacgreg Ttacgreg on Oct 02, 2018

    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%.

    • See 1 previous
    • Ttacgreg Ttacgreg on Oct 02, 2018

      @King of Eldorado Morons Are Governing America

  • Big Al from Oz Big Al from Oz on Oct 02, 2018

    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.

  • Sam Who do I sue when the car doesn't do what I want it to and that action of the car being autonomous caused the crash?
  • Norman Stansfield Automatic braking systems reward bad behavior. Stop incentivizing lousy driving behavior.
  • Kwik_Shift It was an annoying feature on my 2018 Nissan Sentra SV. Bugs, leaves and snow would disable it. Should have been a better design .
  • Master Baiter A regulator's job is never done, so yeah, bring on the next level of regulations.
  • DedBull The automatic braking system in my wife's 2019 Tiguan is easily defeated by the slightest amount of solid precipitation, which is not uncommon here in western Pennsylvania. Fortunately we have regular speed-holding cruise control, because the active cruise control uses the same sensor and becomes inactive in the same conditions. It was infuriating in our loaner. I've had a few false-positives over the years, plus a couple where it didn't like my rate of deceleration. Interestingly it did not intervene at all when I had a deer strike a couple years ago. I don't mind the application of the tech, but I think they are setting a pretty high bar going forward. I'm also cautious of over-reliance on tech in vehicles.