Ford Replaces CEO Mark Fields After Stock Prices Dwindle

Ford has just come off two straight years of record earnings. Its F-150 trucks are the best selling vehicles in America. But none of this was enough to save CEO Mark Fields' job. The career Ford executive has been replaced by a relative newcomer, Jim Hackett. One reason for the move: Ford's stock price tumbled nearly 40 percent in the three years Fields was at the helm.

ARI SHAPIRO, HOST:

There are a lot of threads to the story of Ford Motor Company over the last several years. It avoided bankruptcy during the financial collapse. In the last few years, the company has enjoyed record sales and, with that, record profits.

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Sounds like good news, but in the last three years, Ford's stock has also lost nearly 40 percent of its value. And it's a good bet that's one of the reasons why Mark Fields is out as Ford's CEO. Here's NPR's Sonari Glinton.

SONARI GLINTON, BYLINE: Want to get a glimpse of the unique challenges that faced Mark Fields when he was the CEO of Ford? Well, let's listen to an interview Fields did on this program with Ari Shapiro in 2015.

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MARK FIELDS: As a automaker, we're really focused on our core business, which is designing, developing and manufacturing and marketing terrific cars, utilities and trucks. At the same time, we're seeing a lot of the societal factors around congestion and what that means for mobility going forward. And that's why we're thinking also of ourselves as a mobility company.

GLINTON: OK, that right there was Mark Fields' big problem. He may have wanted Ford to become a mobility company - and by mobility, he means competing with the likes of Uber and Lyft - but right now, it's a car company. And Wall Street has expectations for car companies - quarterly profits.

REBECCA LINDLAND: Stocks of the major automotive manufacturers - I mean they're really, like, kind of the ugly stepsisters of Wall Street as opposed to being the darlings like almost any tech stock appears to be.

GLINTON: Rebecca Lindland is executive analyst at Kelley Blue Book. She says with tech stocks, you can use your imagination. She says Ford and Mark Fields suffer when compared with your ordinary tech stock.

LINDLAND: It's a lot of hope. It's a lot of possibilities. It's, my goodness, what could this become? You know, could Tesla become the next Apple, the next Amazon? And whereas with automotive stocks, you know, 113 years in, you kind of have a good idea of what these stocks can do.

GLINTON: A problem for the new CEO, Jim Hackett, is effectively telling the story of Ford to its shareholders.

LINDLAND: We have to think about the monthly sales and what brings consumers into the dealership today. And then you also have to think about what's going to bring them in in seven to 14 years.

GLINTON: Here's one of the problems with thinking 14 years out. Everyone - and I mean everyone - in the auto business is expecting - no, they are planning for some huge disruption. It's called the self-driving car. Jeremy Carlson is an auto technology analyst for IHS Markit. He says the auto industry has fundamentally changed in the last 10 years.

JEREMY CARLSON: It's not just about designing and manufacturing cars anymore, and it hasn't been really for a long time. You're looking at so much electronics and different ways of using the car and different ways to get from point A to Point B that there's just so much change that it's forcing companies to adapt.

GLINTON: Be ready to adapt and pay a dividend. That's the challenge for Hackett, Ford's new CEO. And that's what Wall Street is telling Detroit according to Kristin Dziczek with the Center for Automotive Research.

KRISTIN DZICZEK: This is the longest expansion we've had since 1917. It's going to slow down. The challenge is now making money in that flat market.

GLINTON: Make money in a flat market or even a downturned one, and get the country ready for self-driving cars. Ford's board didn't think Mark Fields was up to the task, but no one's won that race so far. Sonari Glinton, NPR News.

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