Ford Reaffirms Forecast at Meeting
Ford Motor Co. held a mostly upbeat shareholder meeting Monday, saying it was on track with its profit and new vehicles, as it capped a five-day celebration of its 100th anniversary.
Ford Chairman and Chief Executive William Clay Ford Jr. fielded some sharp questions from shareholders about the company’s outlook and its environmental record.
But most of the speakers from the crowd of 1,294 shareholders congratulated him and the company founded by his great-grandfather Henry Ford.
The meeting was held under tight security not far from Ford’s headquarters. Company executives said there had been security concerns, but declined to be more specific.
Not all shareholders are happy about the state of the second-largest automaker, which is struggling with huge pension and health-care liabilities and saw its stock drop to a more than 10-year low this year after losing $6.4 billion in 2001 and 2002.
Ford’s shares have since rebounded from their low of $6.59 and were up 26 cents to $11.23 on Monday on the New York Stock Exchange.
“Unless the company can reverse its present course, the long-term prospects for Ford’s continued success are poor,” said stockholder Richard Mills, who spoke against reelecting Ford’s board of directors. “A turnaround of the company is far from assured.”
Ford once again reiterated its goal of earning 70 cents a share, or about $1.2 billion, in 2003 despite mounting costs for U.S. vehicle incentives.
“We expect our cost reductions will offset all cost increases, including rising pension and health-care costs, as well as the deterioration in net pricing associated with higher incentives,” Chief Financial Officer Allan Gilmour said.
Ford did announce that Carl Reichardt, its 71-year-old vice chairman, would step down from the post within the next year but remain on the board. Reichardt, the former chairman and chief executive of Wells Fargo & Co., was appointed vice chairman in 2001 to oversee Ford Credit, the company’s lending arm, which manages about $190 billion in loans.
Under Reichardt, Ford Credit has returned to its traditional role as a moneymaking machine for Ford and is expected to contribute most of the $1.2 billion in profit targeted for 2003.
Gilmour will assume Reichardt’s duties, and Bill Ford later said the company had stopped looking for a CFO to replace Gilmour, saying only, “We’ve got a good idea of what we want to do.”
Environmental groups had vowed to make Ford’s record on fuel economy and greenhouse gases an issue at the meeting, but environmentalists wound up offering divergent opinions on Ford’s efforts.
One group praised Ford’s efforts to cut emissions from factories, but another called on the automaker to raise the average fuel economy of its vehicles to 40 miles per gallon by 2013.
