Alan Mulally's legacy at Ford Motor sets high bar for Mark Fields
With a few turnaround successes under his belt, successor will take charge of a firm in its prime
When Mark Fields took charge of Ford Motor's Americas operations nine years ago, it was a major repair job as they descended into record losses and almost dragged the company into bankruptcy.
Today, Ford's North American operations are the envy of the industry, earning a record operating profit of US$8.78 billion last year and profit margins above 10 per cent in an industry where 5 per cent is respectable.
Now that Fields is poised to succeed Alan Mulally as chief executive, he is taking charge of a carmaker in its prime. Ford earned US$42.3 billion in the past five years after losing US$30.1 billion from 2006 to 2008. Fitch Ratings upgraded Ford's outlook this week to positive from stable. Surging sales of Escape sport-utility vehicles, F-Series pick-ups and Fusion models drove Ford's US sales up 11 per cent last year. In China, the world's largest car market, Ford now outsells Toyota Motor. Fields' greatest challenge is following Mulally.
"Mulally is going to be known as one of the great leaders of the American automobile industry," said Jeffrey Sonnenfeld, associate dean of the Yale University School of Management. "He lifted spirits during a time of distress. There are very few turnaround types like him."
Fields has engineered a few turnarounds of his own in his 25 years at Ford. At age 39 in 2000, Fields became chief executive of Mazda Motor, in which Ford had a controlling stake at the time. He led a turnaround at Mazda with several Ford executives with whom he later worked closely to revive Ford's North American business. Along the way, he has also transformed his image from a mullet-sporting Jersey boy to a legitimate leader with gravitas.
"He's matured in front of the camera, almost like a child actor," said Jim Press, a senior Toyota executive when Fields was leading Mazda's turnaround. "He was very well thought of in Japan, in his 30s, running Mazda."
The hard times Ford faced five years ago humbled Fields, Sonnenfeld said. "He's always had a quick wit and charm and a lot of energy, but he's been so tempered by the ups and downs," he said. "Going through that period and living with the consequences gave him a certain humility."
Now he is being handed the keys to the company. Ford would soon announce his promotion to chief executive and reveal the timing of Mulally's departure, which would be this year, said two sources familiar with the matter. Mulally would leave the company for another substantial role, said the sources.
"Ford is undeniably in a very good place," said Karl Brauer, senior analyst with car researcher Kelley Blue Book. "Fields didn't always appear quite so confident and assured, but he's matured in the last five years and become an extremely good representative for Ford."
These days, Fields' fit, well-groomed appearance actually works in his favour as the company goes after the elusive Generation Y.
"He's 53 and he could probably pass for 38," Brauer said. "That's going to help him appeal to younger people. It's going to give the company a more young and vibrant image because he's the head of it."
