Ford Motor Company (F) Fires, Replaces CEO Amid Stock Price Plunge

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May 22, 2017 6:36am NYSE:F

From Tyler Durden: Confirming weekend rumors of a dramatic management shakeup at Ford, late on Sunday Forbes reported that Ford would replace CEO Mark Fields with Jim Hackett, the former head of office-furniture maker Steelcase who joined the auto maker in 2016.

Fields leaves after a 28-year career at Ford, including a prominent tenure as the head of the company’s North American operation. He restructured the company’s core unit while working under Chief Executive Bill Ford in the middle of last decade and then continued the revamp when Alan Mulally took the helm in 2006. Fields was also prominent in restructuring Ford of Europe and Mazda Motor Corp. , in which Ford long held a significant stake.

Jim Hackett is set to take on the CEO post at the auto maker

The move comes amid an ongoing decline in Ford’s share-price during Fields ’ three-year tenure, and recent pressure on profits and market share. The executive shake up, confirmed by the WSJ, has yet to be confirmed by the company. The move comes amid substantial turmoil in the auto industry, where used car prices and tumbling and new car sales have suffered a recent air pocket. The company’s “unusual choice” has taken pundits by surprise, as Ford appears to be turning to Hackett, an industry outsider, who will be leading a company full of senior executives widely seen as capable of succeeding Mr. Fields.

According to the WSJ, Jim Farley, recruited by Ford from Toyota last decade, “will also be given a new prominent role and work directly under Mr. Hackett. A group of other executives will be reassigned.”

Ford’s board began discussing changes to the leadership team recently as the share price hovered around $11 a share, or nearly 40% lower than the summer of 2014 when Mr. Fields took over. Ford’s market cap was surpassed by automotive upstart Tesla Inc.’s in April, a development that underscored how far behind Ford is perceived to be in the race to develop new technology.

Before his elevation to CEO, Hackett chaired Ford Smart Mobility LLC, a subsidiary formed last year by Mr. Fields to explore new ventures in ride hailing, car sharing and self-driving vehicles. Over 30 years at Steelcase, Hackett “reshaped the company’s workplace offerings, dispensing with cubicles and embracing open offices. Later, as interim athletic director for the University of Michigan, Mr. Hackett famously recruited NFL coach Jim Harbaugh to lead Michigan’s football program.?”

One of several auto-industry outsiders recruited by Ford, Mr. Hackett was installed to be instrumental in helping Ford moves into transportation-related services at a time of changing attitudes toward car ownership and emerging Silicon Valley rivals such as Uber and Google.

It remains to be seen, however, if and how the new CEO can deliver a stock price rebound amid an auto industry landscape that is suddenly looking far weaker, amid sliding auto loan demand and plunging used car prices.

Ford Motor Company (NYSE:F) was unchanged in premarket trading Monday. Year-to-date, F has declined -10.39%, versus a 6.61% rise in the benchmark S&P 500 index during the same period.

This article is brought to you courtesy of ZeroHedge.

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