- The Washington Times - Tuesday, September 5, 2006

Bill Ford Jr., who as chief executive of Ford Motor Co. saw Toyota outsell the struggling Detroit automaker, resigned yesterday and was immediately replaced by Alan Mulally, former executive vice president of the Boeing Co.

Mr. Ford, 49, led Ford for five years. He will continue his duties as executive chairman of the company founded by his great-grandfather Henry Ford.

In an e-mail to Ford employees yesterday, Mr. Ford said the company needed fresh leadership.

“While I knew that we were fortunate to have outstanding leaders driving our operations around the world, I also determined that our turnaround effort required the additional skills of an executive who has led a major manufacturing enterprise through such challenges before,” he wrote.

He added that Mr. Mulally had applied many of the lessons from Ford’s development of the successful Taurus model to Boeing’s creation of its new Boeing 777 airliner.

The Dearborn, Mich., automaker, which lost $254 million in the second quarter, has been hurt by competition from fuel-efficient cars, mostly from Asian manufacturers.

In January, Ford announced a major restructuring intended to restore the company to profitability by 2008. The plan was intended to deliver more innovative products while reducing costs and improving quality and productivity. It also called for cutting up to 30,000 jobs and closing 14 facilities by 2012.

In July, when Japanese Toyota Motor Corp. outsold Ford in the U.S. for the first month ever, the U.S. automaker announced it would speed up its restructuring plans.

Some critics attributed Ford’s foundering sales to a lack of fuel-efficient offerings.

“Ford has always acted like making a car more efficient was harder than rocket science,” said U.S. Rep. Edward J. Markey, Massachusetts Democrat and a member of the House Energy and Commerce Committee. “The first thing Mr. Mulally should do is reverse Ford’s disastrous retreat on hybrid vehicles so that America can once again lead the world in auto technology.”

Mr. Mulally, 61, who worked for Boeing for 37 years, was named chief executive of Boeing’s commercial airplanes division in 2001. That unit generated record orders and sales of more than $22.6 billion last year.

Boeing Chairman and Chief Executive Jim McNerney said yesterday that Mr. Mulally had discussed with him the prospect of leaving a few weeks before he turned in his resignation Friday.

“In my opinion, I think he should’ve stayed [at Boeing], but it’s very clear to me that there was an itch he had to scratch, and it was the opportunity to run a big company,” said Mr. McNerney, who appointed Scott Carson to replace Mr. Mulally yesterday.

Charlie Hughes, former head of North American operations for Land Rover and Mazda, said the selection of Mr. Mulally came as a surprise.

“Keep in mind that the automotive industry is covered by an awful lot of really good journalists who are well connected, so I think this was handled pretty well [by Ford] because the majority of people did not know,” said Mr. Hughes, the author of a soon-to-be published book on the U.S. auto industry.

Mr. Hughes said Ford has a history of bringing in top executives from outside the company, and the hiring of Mr. Mulally looks like a good move.

“He certainly seems like a very strong choice,” he said. “He’s been given credit for turning [Boeing’s] commercial aircraft division around, which is no easy job.”

Ford shares rose 12 cents to close at $8.39 in trading on the New York Stock Exchange before the announcement. Its shares rose another 39 cents to $8.78 in after-hours trading.

• This article was based in part on wire service reports.

LOAD COMMENTS ()

 

Click to Read More

Click to Hide