Ford Motor Company Chief Operating Officer Jim Farley Will Take Over as CEO, Jim Hackett to Retire
Ford Motor Company will have a new CEO as of Oct 1. Ford announced this offering that its Chief Operating Officer Jim Farley will take over as its new leader while current CEO Jim Hackett announces his retirement.
Jim Hackett, who has led Ford Motor Company's transformation since May 2017 as president and CEO. In his place Farley officially becomes Ford's president and CEO effective Oct. 1. He was also elected to Ford's board of directors.
The announcement is unexpected, but the shakeup at Ford comes as the automaker's stock has underperformed with Hackett at the helm for the past three years. Since taking over in 2017, Ford's stock has lost nearly 40% of its value and never topped $15 per share. The stock fell to $4.24 in April, its lowest levels since the recession of 2009, during the shutdowns as a result of the global pandemic. After the news was announced this morning, Ford stock rose 1.6% to $6.80.
Ford said that Farley will work closely with Jim Hackett over the next two months to help ease the transition into his new role. Hackett will remain onboard as a special advisor to the company through March of 2021. He said the time is right to pass the mantle of leadership to Jim Farley.
"I am very grateful to Jim Hackett for all he has done to modernize Ford and prepare us to compete and win in the future," said Bill Ford, Ford's executive chairman. "Our new product vision – led by the Mustang Mach-E, new F-150 and Bronco family – is taking shape. We now have compelling plans for electric and autonomous vehicles, as well as full vehicle connectivity."
Hackett, who is 65, has been president and CEO of Ford since 2017. Since that time, he. spearheaded Ford's transformation to become a mobility company. The automaker has invested heavily in electrification with the Mustang Mach-E and upcoming electric F-150 pickup, as well as autonomous driving technology with its investment in Argo AI, a Pittsburgh-based developer of self-driving technology.
Farley collaborated with Hackett over the past three years to develop and execute Ford's "Creating Tomorrow Together" plan to transform Ford into a higher-growth, higher-margin business, which entails moving away from traditional sedans and building more SUVs and crossovers, a segment that's widely popular with consumers.
Ford's Chief Operating Officer Jim Farley will take over as company CEO on Oct 1.
Farley joined Ford in 2007 as global head of Marketing and Sales. He went on to lead Lincoln, Ford South America, Ford of Europe and all Ford global markets.
In April 2019, Farley was tapped to lead Ford's New Businesses, Technology & Strategy team, helping the company determine how to capitalize on powerful forces reshaping the industry – such as software platforms, connectivity, AI, automation and electrification. He was named chief operating officer in February of this year.
Before Hackett became CEO, Ford and its chief rival General Motors were seemingly caught off guard with the runaway success of electric automaker Tesla, which has become the world's most valuable automaker in just a decade.
Tesla also pioneered the use of collecting vehicle data from its global fleet and the use of over-the-air software updates to keep its electric vehicles up to date. Tesla also invested in autonomous driving technology with its Autopilot feature, while Ford focused more on highly profitable full-size trucks and SUVs.
Now Farley finds himself responsible to make these much needed changes at Ford so the automaker can remain more competitive as the auto industry transitions to electrification and connectivity.
Ford's truck business is also facing new competition from new startups, Rivain, Nikola Motor and Lordstown Motors. The three EV companies are focused on electric trucks that will compete with Ford's popular F-Series pickups, a segment Ford currently dominates, but for how long is hard to say.
Ford can still turn things around, starting with the launch of the Mustang inspired Mach-E later this year. The fully-electric Mach-E is Ford's first EV to challenge Tesla.
"My goal when I took on the CEO role was to prepare Ford to win in the future," Hackett said in a statement. "The hardest thing for a proud, long-lived company to do is change to meet the challenges of the world it's entering rather than the world it has known. I'm very proud of how far we have come in creating a modern Ford and I am very optimistic about the future."
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