A little executive bloodletting can sometimes ease the pressure on an embattled chief executive officer (CEO). But Jim Hackett is unlikely to see any letup from Ford’s board following the surprise early retirement of one his two top lieutenants.
Joe Hinrichs, Ford’s 53-year-old automotive president, will leave on March 1 after almost two decades with the company. As a rising star under celebrated former CEO Alan Mulally, he was put on the fast track to be a potential heir to the top job.
With Hinrichs out of the picture, Ford is elevating Jim Farley, the company’s only other president, to become the first chief operating officer (COO) since the automaker planned for Mulally’s succession seven years ago. The announcement that the board will revive the role of COO came days after Hackett reported dismal earnings results, dogged by the disastrous rollout of the redesigned Explorer SUV, and forecast more disappointing numbers for the upcoming year.
“This signals to everyone that Farley is Hackett’s successor, unless they plan to go outside the company,” said David Whiston, an analyst with Morningstar in Chicago. “Perhaps it could be nine months from now, or it could be 18 months from now, but they will make an announcement that Hackett is retiring and Farley takes over as CEO.”
Hackett, who was asked by an analyst 18 months ago whether he expected to last in the job, told reporters Friday he’s not going anywhere.
“As far as my tenure, this is the kind of thing I love to do and I’m having a really fulfilling assignment here,” said the former CEO of office-furniture maker Steelcase “I need to be here.”