The Atlanta Journal-Constitution
FORD PROMOTES ONE PRESIDENT, LOSES ANOTHER AMID SLUMP
What happened?
Ford promoted a president seen as a leading candidate to become the next CEO while the other leaves the automaker in the midst of a years-long slump.
Jim Farley, 57, will become chief operating officer while Joe Hinrichs, 53, retires after 19 years with the company. Ford announced the shakeup days after projecting 2020 profit that was well below Wall Street’s expectations, sending shares plunging the most in nine years.
What does it mean?
The surprise shake-up adds to the alarm over how poorly Ford has been performing. CEO Jim Hackett, who took over in 2017, pointed to the new Explorer SUV last year as the product that would prove his team was fixing what ailed the company. But Ford ended up botching the launch, further testing the patience of investors.
“There’s no room for that type of miss in terms of the launch of a product,”Hackett said on a call with reporters.“So we’ve taken steps to make sure that all the new product that we’re having come out, that we really have our arms around that.”
As president of automotive operations, Hinrichs oversaw the launch of the Explorer.
What was the effect?
Ford shares fell 1.7% Friday, finishing at $8.12. The stock is down more than 50% since July 2014.
What is the outlook?
Hackett said that Ford has “a very deep bench” that will guide important new model launches including the redesigned F-150 pickup and new electric Mustang Mach-E crossover.
“I’m really confident that we won’t miss a beat,”he said.