Ford Motor Company is replacing chief executive Mark Fields with James Hackett, the head of the unit developing self-driving cars, the US motor firm said yesterday, responding to investors’ growing unease over its stock price and prospects.
The abrupt departure of Fields, 56, who spent less than three years in the job, is among a series of management changes at Ford.
Hackett, 62, a former chief executive of furniture manufacturer Steelcase, will take the helm in a broader shake-up aimed at speeding up decision-making and improving operations.
Ford shares were up 1.4% in early trading. At Friday’s close, they had fallen 37% since Fields took over three years ago, at the peak of the US motor industry’s recovery.
Now US sales are slipping, and Ford’s profits are trailing those of larger rival General Motors, whose shares fell 13% over the same period.
Executive chairman Bill Ford and the board have been unhappy with the company’s performance and sought reassurance that investments in self-driving cars, electric vehicles and ride services would pay off.
“With this transition, we are moving forward with great optimism,” Ford said.
“We have the right team to sharpen our operational excellence, modernise our business, and develop and invent new business models for the future.”
Hackett, a former football player at the University of Michigan and interim athletics director, was named chairman of the firm’s Ford Smart Mobility LLC subsidiary last year to focus on emerging businesses that include ridesharing and autonomous vehicles.
Ford said in February it was investing $1-billion (R13.2-billion) in artificial intelligence company Argo AI to develop a virtual driver system for the firm’s autonomous vehicle, to be launched in 2021.
The upheaval at Ford underlines pressure on all three Detroit motor firms to prove they can avoid losses as the US market begins to slow from last year’s record sales.
Fiat Chrysler Automobiles is fighting diesel emissions cheating allegations from US and California regulators, following chief executive Sergio Marchionne’s failed bid to find a merger partner.
GM chief executive Mary Barra is fending off attacks from hedge fund Greenlight Capital, which wants to install three new directors and split the company’s stock.
In March, GM sold its moneylosing Opel division to France’s PSA Group, effectively exiting Europe.
The shake-up at Ford may bring new scrutiny of its own plans in that region.
Ford posted a record $1.2-billion (R2.6-billion) profit in Europe last year, but warned the impact of Britain’s vote to leave the European Union would put a dent in this year’s earnings.