Although some decisions may be unpopular, there’s no denying General Motors has made quite a few business savvy decisions in the past few years. It has exited markets where it consistently lost money, ceased vehicle production in various countries and has invested in areas ripe for future markets in autonomous and electric vehicles and ride sharing.
Ford, however, hasn’t done much of that. Ford Authority reports The Detroit News columnist Daniel Howes painted a bleak picture for the blue oval in the coming years if it doesn’t act quickly. He leads his views by saying, “A respected Wall Street analyst says Ford’s earnings outlook could be cut in half in the next 18 to 24 months.” Why the major cut?
“[Ford’s] best-selling F-Series trucks produce the vast majority of its fat profits [and] it’s not moving quickly enough to reshape its global footprint and get out of places where it doesn’t make enough money.”
Again, this all contrasts with GM, which is making money in multiple segments, cutting rental fleet sales, and as mentioned, cut ties with unprofitable markets.
Ford ousted CEO Mark Fields last month and replaced him with Jim Hackett, who was most recently leading the automaker’s Smart Mobility operations. He was CEO of office furniture maker Steelcase for 20 years.
Finally, Howes provides a bit of hindsight. He says former CEO Alan Mullaly took Ford to new levels, but in a traditional sense. Today, that just won’t do.
“The house that Alan built is necessary, but it’s not sufficient for the new world,” Howes said.