Ford CEO Jim Hackett has announced to retire in October, leaving the leadership to optimistic Jim Farley, who will seek to recover the investors’ confidence. Jim Hackett’s career involved an embarrassing $11 billion restructuring plan that provoked skepticism among the investors.
Hackett, who had earlier planned to stay, eventually announced to retire on October 1st, as his three-year tenure at the company comes to an end. Hackett will be succeeded by James D. Farley Jr., who had been promoted as the chief operating officer in February.
Farley will take charge as the fourth CEO of the company since the great recession. Ford saw a 3 percent rise in its share prices after the announcement was made on Tuesday.
Executive Chairman of Ford, William Clay Ford Jr. said, “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”, the company is becoming “much more nimble.”
Hackett was a chief executive of Steelcase, which is in the business of manufacturing office furniture in a small case. Then, he was positioned as chief executive of Ford in May 2017 when Ford was going through a crisis.
He aimed to move the company into a direction where they will develop profitable vehicles besides investing in technologies such as electric vehicles. He also built plans to get working on electric vehicles along with building relationships with automakers like Volkswagen, Mahindra, and Rivian.
However, his plans did not come around as anticipated. Ford saw a decline in its profits between the years 2018 and 2019. In 2020, during the global pandemic, the company has lost $876 million.
During Hackett’s tenure, share prices of Ford fell by 40 percent, leading to a decline of 28 percent in the market value, which is at $26.1 billion as of 2020.
In February, Hackett mentioned that “I plan on staying in this job” and showed no interest in retiring.
However, now the outgoing CEO believes that this is a perfect time for Farley to take over as the company shows momentum through the recent product unveiling, besides expecting increasing performance amidst the global pandemic,
In February, Farley was positioned as Chief operating officer. Previously, he had worked with Toyota for almost half of his career and started working at Ford in 2007.
From 2007, he had been working on improving the strategy, marketing, and operations across the Middle East, Europe, and Africa. Now, he aims to carry forward his plans based on Hackett’s work to improve the scale of the company.
Farley talked about the competition and stated, “We know our competition today. It’s Amazon, Apple, Tesla, Toyota, and others. They’re well-financed and voracious companies—and I’m inspired by the positive momentum that we’re now building.”
As the new leader, Farley is positive about the plans that are being laid for the growth of the company. He promises to come up with autonomous and all-electric vehicles, which involve building and working on the new Mustang Mach-E crossover.
“We need to swing for the fences,” he said. “To grow and expand where we are already strong.”