New Models Fuel Ford Hopes
An onslaught of new cars and trucks from Ford Motor Co. should keep the world’s second-largest auto maker on schedule to return to profitability and regain market share lost in last year’s stunning reversals, company executives told shareholders at Ford’s annual meeting Thursday in Irvine.
Chairman and Chief Executive William Clay Ford Jr. reiterated the company’s earlier forecast by saying Ford Motor is on track to “break even or better” by year’s end with a profitable second half.
The company lost $5.45 billion last year, largely on the costs of its massive recall of tires from Bridgestone/Firestone Inc., and posted an $800-million loss for the first quarter this year on costs of a new restructuring plan.
That plan calls for Ford Motor this year alone to trim 5,000 jobs from its worldwide payroll and cut production costs by $375 million. The full five-year goal calls for elimination of 35,000 jobs, five plants and four slow-selling models from its Ford and Mercury brands.
In his first meeting with shareholders as chief executive since ousting Jacques Nasser from that post last year, Ford said the company already is more than halfway to achieving this year’s restructuring goals.
Recapturing market position might take a little longer, but Chief Operating Officer Nicholas V. Scheele said the firm believes it can boost sales and share through its plan to introduce nearly four dozen new or redesigned vehicles worldwide during the next five years, 20 in North America.
Tough new competition from General Motors Corp., DaimlerChrysler, Toyota Motor Corp. and Honda Motor Co. has hurt Ford Motor in the sport utility vehicle and full-size pickup segments it once ruled.
In a nod to corporate reform in the wake of the Enron Corp. and Arthur Andersen scandals, CEO Ford told shareholders that the company’s 14-member board intends to revise rules this week to replace director John L. Thornton, president of investment banker Goldman Sachs Group Inc., on the audit committee.
“We want to make sure that every member of that committee is an independent director by anyone’s definition of the word,” Ford said.
Only one shareholder of the nearly 400 present, corporate critic Evelyn Y. Davis, complained of the $4.9 million that Nasser received when he retired under pressure last year. But Ford said it was not severance pay but salary, bonus and incentive money Nasser had earned in previous years.
The annual meeting, the company’s first in California, was held at the new Lincoln Mercury world headquarters.
Ford Motor shares lost 6 cents to close at $15.94 on the New York Stock Exchange.
