Ford gears up for the future with new chief executive


Mark FieldsImage copyright
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Mark Fields took up his role in 2014

Ford has sacked its chief executive, Mark Fields, following a major reshuffle at the US car giant.

His departure comes as Ford faces weak sales, falling profits and a near-40% decline in its share price since Mr Fields took up his role in 2014.

He is being replaced by Jim Hackett, who heads Ford’s autonomous driving division.

Last week, the carmaker said it planned to cut about 10% of its global workforce.

Ford employed more than 200,000 people globally at the end of 2016, including about 101,000 in North America and 23,000 in Asia.

Sales in April were down 7% in the US and 11% lower in Europe compared with the same month last year. The firm has also been hit by costs related to safety recalls.


Analysis

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By Russell Hotten, business reporter

Mark Fields isn’t just paying the price for a fall in Ford’s US sales and a big slide in the share price over the past 12 months: he’s be a casualty of the company’s failure to prepare for the future.

Ford, which gave the world its first mass-market car, is witnessing the end of the internal combustion engine. Long-range electric and autonomous transport is tomorrow’s technology, and the likes of General Motors, Toyota, and Volkswagen are ahead in the race to exploit it.

Last month, Ford’s stock market value fell behind Tesla, the electric car upstart that has never made a profit. It was a symbolic moment that underlines Ford’s problems.

It’s not that Mr Fields has failed to pour billions of dollars into self-drive and ride-sharing experiments – it’s that shareholders see little return in sight.

Recent reports of tense boardroom meetings, compounded by a tetchy annual shareholders’ meeting earlier this month, probably explain why Ford chairman Bill Ford Jr has acted now.

Mr Fields’ replacement, Jim Hackett, heads the division that was set up to accelerate Ford’s foray into autonomous vehicles. Mr Hackett also has a reputation as a cost-cutter. Experience of both will be needed in the years ahead.


Investment

Last year, Ford sold 6.65 million vehicles worldwide, while rival General Motors sold 9.97 million, according to Statista.

GM reported a record performance in the first three months of 2017, with revenue 10.6% higher at $41.2bn, helped by strong sales of trucks and SUVs in the US.

Ford’s revenue in the first three months of 2017 was $39.1bn, a rise of 4%.

At the time Mr Fields said the quarter was “an investment in Ford’s future”. The company launched new vehicles and he said it was “fortifying our core business, while also investing in emerging opportunities that will deliver profitable growth”.

In recent years, Ford has been investing heavily in self-driving technology and ride-sharing services.



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