Ford Motor Co. (ticker: F) shares traded higher by more than 1.3 percent on Monday morning after the company announced it would replace CEO Mark Fields with the head of its autonomous vehicles department, Jim Hackett. Ford and its investors are hoping Hackett can turn around Ford’s slumping profits and pave the way to a brighter future.
“Jim Hackett is the right CEO to lead Ford during this transformative period for the auto industry and the broader mobility space,” Ford executive chairman Bill Ford Jr. said. “He’s a true visionary who brings a unique, human-centered leadership approach to our culture, products and services that will unlock the potential of our people and our business.”
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During his three-year tenure as CEO, Fields drew criticism from investors for Ford’s lack of innovation at a critical time in the auto industry. Tesla ( TSLA) and Alphabet ( GOOG, GOOGL) are both expected to have fully driverless vehicles on the market by 2019. Ford hopes to have its own fully autonomous vehicle available by 2021.
Hackett served as CEO of office furniture company Steelcase for 20 years before joining Ford as head of the autonomous vehicles business last year. Hackett also served 16 months as the interim athletic director at the University of Michigan.
Hackett gained his reputation as an innovator at Steelcase, where he improved the company’s workplace environment by eliminating cubicles in favor of a more open office workspace, a strategy that would later become commonplace among major companies.
Hackett is also credited with making deep but necessary spending cuts at Steelcase that helped get the company on a sustainable long-term trajectory. Ford has already been implementing similar cost-cutting initiatives, including laying off 10 percent of its global workforce earlier this month.
One of Hackett’s primary goals will likely be to improve communication with investors.
“Ford’s reputation with the investor community with respect to the secular pressures is that they are throwing a lot of things at the wall,” RBC Capital Markets analyst Joe Spak wrote on Monday.
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“The overall communication hasn’t been great. A simpler message may be needed.”
Ford’s stock fell roughly 40 percent while Fields was CEO, and the company reported a 35 percent decline in net income in the first quarter of 2017.
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Investors Cheer Ford?s Innovative New CEO originally appeared on usnews.com
