Incoming Ford CEO Jim Farley (left) and Ford Executive Chairman Bill Ford Jr. pose with a 2021 F-150 during an event Sept. 17, 2020 at the company’s Michigan plant that produces the pickup.
Michael Wayland / CNBC
Ford Motor‘s new CEO Jim Farley is shaking up the company’s top ranks and restructuring operations as the automaker struggles to bolster shareholder confidence and stay relevant in an increasingly competitive market.
Farley, who succeeds Jim Hackett, is streamlining operations and refocusing on key growth areas like autonomous and electric technologies as well as commercial vehicles. The changes come at a pivotal time for Ford. For years, the company has failed to gain Wall Street’s confidence in its business operations and labored to execute an $11 billion turnaround plan announced by Hackett in 2018.
Ford shares slid 40% under Hackett, who succeeded longtime Ford executive Mark Fields as CEO in May 2017. The stock is down 28% so far this year.
Farley hopes to get Ford back into Wall Street’s good graces, something Hackett and Fields were unable to accomplish. It’s something only former Boeing executive Alan Mulally, who led the Ford through the Great Recession without bankruptcy, has been able to do in recent history.
“During the past three years, under Jim Hackett’s leadership, we have made meaningful progress and opened the door to becoming a vibrant, profitably growing company,” Farley, who became CEO effective Thursday, said in a statement. “Now it’s time to charge through that door.”
The goal, according to the company, is to “move with urgency to turn around its automotive operations – improving quality, reducing costs and accelerating the restructuring of underperforming businesses.”
That will include leveraging its critically important and $42 billion F-Series pickup franchise to finance investments in emerging technologies. Ford is viewed by many as being behind others, particularly General Motors, in its plans for autonomous and electrified vehicles as well as global cost restructuring.
Ford also must maintain, if not grow, its truck business amid a host of new electric pickups expected from Tesla, GM and startup Rivian, among others. The company plans to release an electric version of its F-150 pickup in mid-2022.
Farley, who most recently served as chief operating officer, announced the changes during a virtual town hall meeting Thursday with the company’s global team.
Ex-Amazon exec out as CFO
CFO Tim Stone, a former Amazon executive who was a high-profile hire for Hackett, is leaving the company after just 18 months, the company announced.
Stone, 53, is going to artificial-intelligence software company ASAPP as chief operating officer and chief financial officer, Ford said.
He’ll be succeeded by John Lawler, 54, who most recently served as CEO of Ford’s autonomous vehicles unit and vice president of mobility partnerships. He spent much of his 30 years at Ford in finance leadership and general management.
Tim Stone, Ford Motor Co. Chief Financial Officer, speaks during an interview outside the New York Stock Exchange (NYSE) in New York, August 17, 2020.
Brendan McDermid | Reuters
Ford also plans to add new executives as chief information officer and chief marketing officer. Jeff Lemmer, 55, Ford’s chief information officer, will retire Jan. 1 after 33 years with the company. Joy Falotico, 53, who has been president of the automaker’s luxury Lincoln brand and Ford’s chief marketing officer, will be dedicated solely to the Lincoln line.
A Ford spokesman said the new marketing and information officer are expected to be announced soon.
Ford’s head of manufacturing in Europe also will retire effective immediately and be replaced by the region’s director of manufacturing and strategic partnerships.
Many of the changes involve areas Farley previously oversaw such as Europe, marketing and the company’s new business operations such as autonomous and electric vehicles.
When Ford named Hackett’s successor in August, Farley promised to speed up the automaker’s transformation efforts and bring a new sense of interest in the company from investors. He said his top priorities were a “smooth transition” in leadership, fixing and accelerating North American operations to achieve 10% profit margins and accelerating growth businesses such as connectivity and electric vehicles to better compete against Tesla.
“Those are growth initiatives that I believe are not in the stock price today,” he told CNBC. “Not that that’s the only thing that’s important, but they’re growth initiatives that could really add tremendous value.”
Farley, who is known as an intense “car guy,” is only Ford’s 11th CEO in its 117-year history but the fourth in the past decade.