On Monday, Ford Motor Company named a new chief executive officer, James Hackett, in response to investors’ increasing worries over stock prices and the company’s ability to survive amid growing competition from Silicon Valley. For example, Ford stock has fallen 37 percent from its peak three years ago, when Mark Fields began his tenure as Ford CEO. Fields retired after a 3-year stint as the CEO and a 28-year career with Ford. Unlike Fields, Hackett has very little experience in the automobile industry.
Hackett has previous experience turning around companies, such as furniture maker Steelcase Inc. and the University of Michigan’s football program. With Steelcase, Hackett laid off thousands of employees in his quest to renew the company and shift its focus to a more innovative style. Hackett has also worked with Ford for at least a year, leading the division dedicated to the research in self-driving vehicles. In that role, he oversaw Ford’s acquisition of Chariot, a San Francisco-based ride sharing business. He was also responsible for a $1 billion investment by Ford in Argo AI, a startup focused on robotics and artificial intelligence and its application to self-driving. Prior to joining the self-driving unit, Hackett was also a member of the Ford Motor board of directors for three years.
According to Ford Chairman Bill Ford Jr., Hackett is expected to speed up decision making in a faster-paced environment. Analysts point to General Motors shedding several unprofitable operations in recent times, as well as Tesla rapidly increasing its market share. “We have to modernize the business,” Ford Jr. said of his plans for the company going forward. Coupled with this news is an upcoming layoff of about 1,400 employees in North America and Asia; that is a much smaller number than the 20,000 layoffs some news outlets previously reported.