Ford Hires New Chief for Smart Mobility Unit
September 29 2016 - 12:30PM
Dow Jones News
Ford Motor Co. has hired a 3M Co. executive to lead an effort to
wade into various mobility ventures, the latest company outsider
hired under Chief Executive Mark Fields's effort to shake up the
113-year-old auto maker's reliance on its core car business.
Raj Rao, who has experience in e-commerce, the fitness industry
and personal connectivity, was named chief executive for the
company's Smart Mobility LLC unit. Mr. Rao will report to division
chairman Jim Hackett, who was hired earlier this year to lead the
newly formed Smart Mobility. Messrs Rao and Hackett join executives
Mr. Fields recruited to run a strategy department and data
operations.
In a statement, Mr. Rao said he wants to help "Ford change the
way the world moves." He joins the company as U.S. auto sales
continue to run at all-time highs and Detroit auto makers enjoy
near-record earnings.
Mr. Fields is using profits to add layers of new managers and to
create new structures within Ford to help it catch up with Silicon
Valley companies that have lapped Detroit in electrification,
testing of autonomous vehicles or ride-sharing solutions. It is
racing General Motors Co. and other established auto makers to
catch up with efforts at Uber Technologies Inc., Tesla Motors Inc.,
Google Inc. and a group of smaller startups and auto suppliers.
Recently, Ford has announced new partnerships and investments or
purchases of smaller firms devoted to developing new services,
including a San Francisco van-shuttle company, a bike-sharing
service and a laser-sensor maker. Those investments and the
company's attempts to get autonomous test vehicles on roads early
next decade could crimp short-term earnings.
Mr. Fields projects 20% earnings margins for the Smart Mobility
unit, but hasn't specified a timetable. Profits would roughly
double what Ford's margins are in North American operations, which
is its most profitable unit.
Mr. Fields' strategy is a departure from his predecessor Alan
Mulally. Mr. Mulally employed a back-to-basics approach, selling
off units acquired prior to his 2006 arrival so the company could
focusing on car, truck and sport-utility development primarily for
the Ford brand.
Ford dove into various services businesses several years ago
under former CEO Jac Nasser, but backed away after losses started
to accumulate in the core auto-making unit. Mr. Fields has said
Ford needs to keep one foot in today and another foot in the
future.
Despite a stream of news related to Ford's mobility and
future-vehicle, Ford's stock price has declined during Mr. Fields'
tenure and was flat Thursday at $12.09.
Write to John D. Stoll at john.stoll@wsj.com and Christina
Rogers at christina.rogers@wsj.com
(END) Dow Jones Newswires
September 29, 2016 12:15 ET (16:15 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
Ford Motor (NYSE:F)
Historical Stock Chart
From Apr 2024 to May 2024
Ford Motor (NYSE:F)
Historical Stock Chart
From May 2023 to May 2024