William Ford Jr., executive chairman of Ford Motor Co., is a somewhat enigmatic figure in the global auto industry who doesn’t speak a lot about the company in public and, when he does, typically is circumspect.
But in his on-stage interview that capped off the press days at the North American International Auto Show in Detroit, Ford laid down a lot to think about. And his remarks in a public, wide-ranging discussion with a columnist for The Detroit News included a multi-layered defense of the recent leadership of an auto-industry icon that has a lot of investors and other observers scratching their heads these days.
Ford has been scuffling for a few years—disappointing in its profit margins, promising but slow in delivering major cost-cutting, deciding to give up on the U.S. sedan market, exhibiting relatively little evident leadership in the new “mobility” paradigm, and confusing so far as to exactly what its strategy is for the future under CEO Jim Hackett, the former Steelcase Corp. chief who’s been at the automaker’s helm for about a year and a half now.
“It’s a hard story because we’re in transition,” Ford said on Thursday. “We can’t tip our hand. Taking our word for it doesn’t fill out [an analyst’s] model. We’ll have to live with a bit of uncertainty as we get through the year. Twenty-eighteen was always going to be a transition year; in 2019 we’ll get some results and people will start to understand.”
And while Ford did plenty of defending of himself and his own actions in the NAIAS interview, he notably didn’t take advantage of any point in the 45-minute exercise to offer a ringing endorsement of Hackett, the man he personally selected to lead his family’s 115-year-old company into a future that looks very demanding and increasingly murky. About the only time he even mentioned Hackett was to borrow the CEO’s term “financial fitness” to describe one of the company’s ongoing important goals.
One reason may be that, while Ford has had an up-and-down series of leaders over the last quarter-century, Bill Ford’s personal stamp has been on CEO succession for all of that time—and his hands have remained firmly on the wheel of other important aspects of the iconic automaker that his family still controls.
So, most of what the company does, even through its nominal chiefs, still comes down to what the Ford scion wants. And a lot of that, of course, is expressed in the bets he makes on CEOs.
It was the great-grandson of Henry Ford who, as the freshly minted, 44-year-old chairman of the board, ousted then-CEO Jacques Nasser in 2001 and took the CEO title as well after expunging a notably bad fit at the top. In selecting Boeing executive Alan Mulally to succeed him as CEO in 2006, Bill Ford made what arguably was one of the best decisions in the history of the company, as Mulally went on to righteously lead a revival of Ford Motor and catapulted it back to major relevance and a strong position in the industry.
But Ford Jr. has made bad personnel bets too, most notably in selecting long-time insider Mark Fields to succeed Mulally in 2014. The jury remains out on Ford’s surprise choice after he broomed Fields, Hackett—a leader who developed a tech-friendly reputation at Steelcase but who has yet to lay out a persuasive vision for the automaker’s future in electrified and autonomous vehicles.
Meanwhile, Ford Jr. has nudged Ford in certain ways from his own perch, and he explained and defended some of those on Thursday. He was an early environmentalist among auto-industry leaders, an approach that has proven prescient, and at NAIAS he proudly reminded everyone that Ford is alone in the U.S. industry in trying to comply with the Paris climate-change accord.
“For a lot of years I wasn’t really popular in the industry for taking a green position,” Ford said. “But I felt it was important to get on the right side of that or we wouldn’t attract the best and the brightest, and I still believe that. We’ve made a lot of progress, but we’ve got a lot more to do.”
Ford also noted that, in a 2011 TED talk, he demonstrated that he was an industry pioneer in suggesting that the future for the auto industry was going to be in serving urban populations, as the world’s burgeoning population increasingly flocked to its cities. “How are those people going to move and how is that going to work?” he said on Thursday. “That’s [a true challenge] even today. We have to find a way in cities to make moving easier.”
While many outsiders now regard Ford Motor as a follower in the shift to autonomous and electrified vehicles, Ford Jr. also purported that he was a visionary about the industry’s future in 2010 in co-founding Fontinalis Partners, a strategic investment firm meant to improve all modes of global transportation.
He said that Ford remains in the driverless-car derby for the long haul and that it and the auto industry in general have made more progress in that area than is being credited to them.
Ford said that his own company has been “relatively quiet” about autonomous vehicles, “and part of the reason is we didn’t want to overpromise and under-deliver. This journey is unknown. How long it’s going to take is unknown. How technology will develop is unknown. [So] making these grand pronouncements and then rushing to get something on the road, if the industry does something wrong, it’ll set it back for years. The reality is it is coming.”
And he believes he’s being equally forward-looking in deciding to purchase the massive, decrepit old Michigan Central train station in Detroit’s ancient Corktown neighborhood to become the automaker’s development headquarters. It’s a huge bet on urban renewal based on Ford Jr.’s vision of luring tech-savvy young workers to a new city center that will provide a historic setting and old-world authenticity instead of the sheen of virtual reality that typifies Silicon Valley campuses. And it has been criticized by some who wonder about that bet because of Ford’s many other vital priorities.
“That [train station] had become a poster child for everything that was wrong about Detroit,” explained Ford, whose family emigrated from County Cork in Ireland in the mid-Nineteenth Century and settled along with many other Irish in Corktown and in Dearborn, Mich., where Ford is headquartered.
“Also, we’re in a war for talent,” he said. “We have something here that can’t be recreated in a Silicon Valley campus. We want to restore it to its former glory and repurpose it to create the future. So it’s cool and compelling.”
There were some murmurs at NAIAS about Ford’s future and that it was out of weakness that the company decided to launch a limited alliance with Volkswagen, initially to share the costs of development and production of trucks and small vans for non-North American markets.
But Ford said he didn’t know “if there’s an end game” with Volkswagen. “We’re just starting. What we’ve announced has been in Europe largely and then in some other markets around the world. And so we want to walk before we run, get to know each other, make sure our cultures … and teams work well together.
“I had to be convinced” on the advantages of teaming with Volkswagen, he confided. “Not on the business equation but on the culture equation. So we’ll see. It’s very early days, but I’m encouraged by the early returns.”
Cross-ownership wasn’t even discussed by the two companies, Ford said, and, just in case anyone missed the point, he added: “Never say never, but I sure don’t ever see a day where the Ford family gives up its voting control of Ford Motor Co.”
In any event, Ford said he’s not giving up his perch at Ford until he sees more of all of this develop.
“I’m 61 but I’m thinking about tomorrow, not yesterday,” he said. “It’s a cool and interesting time in Detroit and in the industry, [so] I don’t spend a lot of time thinking about my legacy and my past. It will be what it is.
“But what I want to do is make the city a great city again and make Ford a great company for today and tomorrow.”