Following a six-month stint as the company’s chief operating officer, Jim Farley has been named president and chief executive of Ford Motor Co. (NYSE: F). Farley will replace retiring CEO Jim Hackett on October 1. Hackett will remain as a special advisor to the company through March of next year.
Hackett, 65, who came to Ford in May 2017 after retiring as CEO of Steelcase, never really got the stock untracked. In early February of this year, shares were trading essentially flat with their price when Hackett took over. The COVID-19 outbreak sent Ford stock down about 55% by late March, and it had recovered about half that as of Monday’s close. Including the recent plunge, Ford stock is down about 28% during Hackett’s term.
Farley, 58, joined Ford in 2007 as head of global marketing and sales under now-retired CEO Alan Mulally. Since then he held a variety of executive roles at the company, before being elevated to chief operating officer, a move many observers saw as a signal that Hackett’s tenure in the corner office was going to happen sooner rather than later.
The relationship to Mulally is not lost on Ford’s executive chair, Bill Ford. Mulally was Ford’s last, great CEO and his anointed successor, Mark Fields, was named CEO following Mulally’s retirement in 2014.
Fields, at the time a 27-year company veteran and then-COO, took over a company that had been rejuvenated by Mulally over his eight-year term as CEO. Rather than fine-tuning a process that Mulally had used to double Ford’s stock price during his tenure, Fields tried to put his own stamp on the company. The share price dropped by 27% in two years and was down 16% when Hackett replaced Fields.
Bill Ford hopes that Farley, whose years at Ford began with Mulally, learned Mulally’s basic lesson: just because something’s not broken doesn’t mean that it can’t be fine-tuned instead of being thrown away. In Wednesday’s announcement, Bill Ford said of Farley that he has developed into “a transformational leader with the determination and foresight to help Ford thrive into the future.”
What Bill Ford is hoping for is that Farley will be what Ford thought Mark Fields was: the second coming of Alan Mulally.
Ford stock traded up about 1.8% early Tuesday, at $6.81 in a 52-week range of $3.96 to $9.65. The stock’s consensus price target is $7.28.