Ford CEO Jim Hackett Not Going Anywhere, Says Ford CEO Jim Hackett

Steph Willems
by Steph Willems
ford ceo jim hackett not going anywhere says ford ceo jim hackett

A rocky past year hasn’t dislodged Jim Hackett from his lofty perch in the Glass House, nor does the CEO feel he’s destined for the door. This assertion comes after a dismal earnings report born of recalls, a botched product launch, and ongoing streamlining efforts, the latter of which hasn’t given Ford’s stock the bounce many had hoped for.

Why does Hackett feel so confident? Friendship.

Specifically, friendship with the one person who really matters: Chairman Bill Ford.

As reported by Bloomberg, the bond between Hackett and Ford is a strong one, perhaps insulating the CEO from flack arising from the company’s poor showing on Wall Street. It’s generally agreed that failure to move share prices in a sustained upward direction is what doomed Hackett’s predecessor, Mark Fields. Since that departure, Ford’s stock has resisted that long sought-after climb.

“Harmony in businesses is a good story,” Hackett told Bloomberg on Monday. “And it doesn’t burst out of lack of accountability at all. It’s more, frankly, of a shared view of how much work we have in front of us to transform the company to be really viable for another 50-plus years.”

In a recent internal town hall, Hackett said the grim earnings report had no bearing on his job. He’s staying put.

The close connection between CEO and chairman has bought Hackett precious time. Shareholder opposition arose quickly under Hackett’s reign, with the CEO’s sedan-sinking plans and desire for electric mobility and automation leaving many wondering if the gamble would pay off. The automaker’s concurrent efforts to streamline its global businesses, bolster its Chinese strategy, and forge an alliance with Volkswagen gave investors food for thought, and a steady march of tried-and-true product introductions (read: trucks and SUVs) placated car-loving shareholders with visions of big margins.

That strategy hit a snag when the Ford Explorer and Lincoln Aviator launched last summer with serious quality control issues, forcing Ford into an expensive repair operation. The damage resulting from the launch earned the automaker a serious profit dive (and its investors a drastically diminished dividend). It also led to the punting (officially, retirement) of automotive boss Joe Hinrichs earlier this month and the elevation of Jim Farley to chief operating officer. That promotion came with a $2 million raise.

“Others will say, well, why has it taken so long? Or why are you contemplating this so rigorously? It’s because we’re balancing the needs of shareholders versus employees, suppliers, dealers,” Hackett said. “We’re not willing to lose the hearts and minds of our people to have one quarter exceed earnings.”

Ford’s stock is currently the lowest it’s been in a decade. At last report, the company’s share price was $7.56, down from $9.18 on February 4th (right before the earnings report landed). This, after the stock appeared to be stabilizing, and perhaps even recovering, in the summer months of 2019. When Fields left in May of 2017, share prices were flirting with $11.

[Image: Adam Tonge/TTAC]

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  • Michael S6 Michael S6 on Feb 25, 2020

    Several years ago, I bought Ford stock given it's generous dividends. I figured that it was priced cheaply and can't go down much. Bad mistake as Hackett hacked down Ford stock value by 35 percent. He eliminated the sedan lines and introduced two half baked SUVS. The explorer having to take remedial classes and still show up at the bottom of the class. The Escape chugging along on a 3 cylinder engine with cheap interior. Oh well, at least I have a tax deduction for two straight years on capital gain losses.

  • TS020 TS020 on Feb 26, 2020

    "I'm not going anywhere" -Disney CEO Bob Iger, one week ago. Probably.

  • Stuart de Baker I didn't bother to read this article. I'll wait until a definitive headline comes out, and I'll be surprised if Tesla actually produces the Cybertruck. It certainly looks impractical for both snowy and hot sunny weather.
  • Stuart de Baker This is very interesting information. I was in no danger of buying a Tesla. I love my '08 Civic (stick), and it feels just as responsive as when I bought it 11 years ago with 35k on the clock (now 151k), and barring mishaps, I plan to keep it for the next 25 years or so, which would put me into my mid-90s, assuming I live that long. On your information, I will avoid renting Teslas.
  • RHD The only people who would buy this would be those convinced by a website that they are great, and order one sight-unseen. They would have to have be completely out of touch with every form of media for the last year. There might actually be a few of these people, but not very many. They would also have to be completely ignorant of the Hyundai Excel. (Vinfast seems to make the original Excel look like a Camry in comparison.)
  • RHD This was awesome, in 1978. Now, it's very much obsolete - thirsty, slow, ponderous, noisy, rough, and dated design even in its time. Still, someone who wants to recreate some distant memories will buy it and restore it and enjoy it, and the seller just has to find that particular individual.
  • BEPLA Cybertruck may have made some kind of weird sense had it been brought on market on time, ie: before Rivian and F150 Lightning.But the market has progressed.If this were any normal company it would be ditched for a more competitive product.But in Elon's narcissistic dreamworld - well, we'll just see how it flops.