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Ford sets succession plan, Mulally staying through 2014

Alan Mulally, President and CEO of Ford Motor Company attends a launch event for the New 2013 Ford Fusion Hybrid car in New York's Times Squ
Alan Mulally, President and CEO of Ford Motor Company attends a launch event for the New 2013 Ford Fusion Hybrid car in New York's Times Squ

By Deepa Seetharaman and Paul Lienert

(Reuters) - Ford Motor Co promoted long-time executive Mark Fields to chief operating officer as part of a management shuffle announced on Thursday that keeps Alan Mulally as chief executive for at least two more years.

The plan, which stopped short of formally naming Fields as Mulally's successor, puts Fields, age 51, in charge of the weekly business review meetings that have been one the most visible signs of cultural change at Ford since Mulally was hired in 2006.

Mulally, 67, will stay on as CEO "at least through 2014," about one year longer than analysts expected and leaving the door open for him to stay longer if needed.

Fields, a 23-year Ford veteran, is widely seen as the front runner to replace Mulally, and Executive Chairman Bill Ford said he hoped the next CEO would come from within Ford's ranks.

Still he did not rule out the possibility of hiring an outsider as he did when he hired Mulally, then an executive at Boeing Co , to steer Ford's turnaround six years ago.

"This isn't really a transition that we're announcing," Bill Ford told analysts and reporters on a conference call.

"We really do have a great team that Alan has developed and mentored, and he'll continue to do that," Ford added. "But don't read anything beyond that into this."

Ford also promoted several other executives, including Joe Hinrichs, who will take on Fields' role as head of the Americas. Hinrichs, who has been mentioned as a possible CEO candidate, now leads Ford's operations in Asia and Africa.

The management changes, approved by Ford's board on October 19, are all effective on December 1.

Naming Mulally's successor is crucial for Ford because he is closely identified with the automaker's rebound and its success in avoiding the federal bailouts that rescued its U.S. rivals in 2009, General Motors Co and Chrysler Group LLC.

'I'M NOT GOING ANYWHERE'

Fields has led Ford's operations in North and South America since October 2005. Bill Ford said that Fields has grown in his role over the last seven years, pointing to this week's third-quarter earnings report as proof. Ford had record 12 percent margins in North America in the third quarter.

"I put Mark into that job seven years ago," he said. "The growth that we've all seen in him over that period is remarkable. Alan has done a tremendous job of mentoring Mark."

Mulally said he will focus on the "long-term strategic development" of his One Ford strategy, which centers on connecting Ford's once-disconnected business units to achieve economies of scale, cut costs and boost profits.

"A really key message today is the fact that Mark is going to take over the responsibility of leading the business plan review for the entire corporation. I'm going to step back from that and focus on supporting Mark," Mulally said.

"And I'll be there; I'm not going anywhere. I'll be there with him and supporting him," Mulally added on the call.

Hinrichs' current position will be split in half with Ford of Europe chief Stephen Odell taking on Africa and David Schoch, now head of Ford of China, leading Asia Pacific operations.

Odell will also add the Middle East to his responsibilities, which include overseeing Ford's restructuring in Europe, where the automaker is expected to lose at least $3 billion over the next two years due to the economic downturn in the region.

Jim Farley, the global head of marketing, will now be in charge of the Lincoln brand. John Lawler, current chief financial officer of Asia Pacific and African operations, will become CEO of Ford China. (Reporting by Deepa Seetharaman and Paul Lienert in Detroit; Editing by Ciro Scotti, Lisa Von Ahn and Steve Orlofsky)

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