We are at a crossroads in the current automotive industry. Consumers are witnessing a huge changing of the guard, where the original carmakers are on the cusp of a usurping by the young, tech-friendly thundercats from Silicon Valley. We’ve seen it time and time again through the business world, and one needs to look no further than companies like RIM or Blockbuster to see what happens when you don’t change with the times.
Major news was reported today as Ford C.E.O. Mark Fields, a nearly 30 year veteran of Ford, was relieved of his duties and replaced by Jim Hackett, who was in charge of Ford’s autonomous vehicle division. The timing and who replaced Fields is very interesting, as Tesla is about to unveil its mass market EV to the world, the Model 3.
Ford’s stock has dropped 40% since Fields took over as CEO three years ago, and shareholders have been demanding a change and an increase in Ford’s profit margins. This dismissal comes less than two weeks after Ford’s annual shareholder’s meeting, where Fields was criticized for Ford’s “dismal” and “Pathetic” performance. This followed the report that Tesla’s market capitalization had surpassed Ford’s for the first time.
With Ford lagging behind its Silicon Valley competitors (Tesla, Apple, Google, Uber, etc.) Jim Hackett has a daunting task ahead of him as he must ensure that Ford remains relevant in today’s ever increasing tech-demanding world:
“I do think that the vision and our role in that future has to be better. I know that that can be better, and I know that we can build better enthusiasm for Ford.
I’ve got all the opportunity to make the decisions we need and a great team to help me get there.”
According to Mr. Hackett, the board has given him free rein to transform the company, which includes potentially seeking alliances with Silicon Valley firms, changing its product lineup, and eliminating unprofitable global operations.
SOURCE | NY Times