Ford Board Deposes CEO Nasser
Ford Motor Co. Chief Executive Jacques Nasser--who has suffered more than a year of humiliation and criticism with the Firestone tire crisis, shrinking profit and market share and quality problems that have plagued his company’s vehicles--has been fired and will be replaced by Chairman William Clay Ford Jr., a source familiar with the company’s plan said late Monday.
The world’s second-largest auto maker will announce the departure of the 53-year-old Nasser this morning and name Nick Scheele, 57, an Englishman who recently became head of Ford Motor’s North America operations, as chief operating officer, the source said.
Nasser’s demise “was long in coming in many ways,” said David Cole, a longtime industry expert and director of the Center for Automotive Research in Ann Arbor, west of Detroit.
“When Jacques was made CEO, I said he could explode in greatness, or the company could explode,” Cole said. Nasser is “an incredibly bright, driven kind of individual, and it’s quite often that a team will perform well for the first couple of years, but then they get lost and they stop following the leader. When you lose the people, the game is over, and I think that’s really happened at Ford.”
With Bill Ford, 44, who assumed the chairmanship in January 1999 when Nasser became CEO, and turnaround specialist Scheele taking over, “it’s not going to be one man at the top, it’s going to be a team at the top, and Bill will be captain of that team,” Cole said.
James Padilla, 55, group vice president for manufacturing and quality, will replace Scheele as North American chief, according to the source, who spoke on condition of anonymity. Vice President for Human Resources David Murphy, 55, and Vice President for Communications Jason Vines, 41, will also be leaving the company, the source said.
Ford board member Carl Reichardt, 70, will be brought in as vice chairman, the industry journal Automotive News said in first reporting the news Monday evening.
Earlier Monday, Nasser attended the production launch in Detroit of a new electric vehicle to be sold by Ford. “Coming in here, I thought I saw some members of the press, but I resisted the temptation [to run them over],” Nasser joked.
Smiling broadly, he posed for pictures with factory workers and Detroit Mayor Dennis Archer.
Asked by a reporter what the main challenges Ford faced going into 2002, he replied, “You have three or four hours?”’
Speculation about Nasser’s future had accelerated in recent months as the company lurched from one crisis to another. Even before the recall of Firestone-brand tires burst into the news in August 2000, quality problems had plagued the launches of the Ford Focus sedan and Escape sport-utility vehicle, triggering multiple recalls.
The Firestone recall focused attention on Ford’s Explorer SUV, as most of the defective tires were sold on Explorers and its sister SUV, the Mercury Mountaineer. Although the cause of the tires’ failure has been traced to faulty production materials and practices at Bridgestone/Firestone Inc., the tire maker fought back vociferously, presenting mounds of data that it claimed showed Explorers were unstable at high speeds and in making tight turns.
It was one of the most withering corporate battles in memory, and was played out daily as the companies traded accusations through the media about who ultimately was to blame for accidents linked to at least 271 deaths and more than 700 injuries.
This summer Ford said it would cut 4,000 to 5,000 jobs, or 10% of its salaried North American work force, to try to stem its profit slide and market share and take after-tax charges of $900 million in the second half, on top of a $3-billion second-quarter charge for a second tire recall that Ford initiated in May.
