Ford selects Padilla for the road ahead
Detroit native becomes president as Scheele and Gilmour retire as expected.
By Eric Mayne / The Detroit News
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Two of the key architects of Ford Motor Co.'s turnaround over the past three years are retiring in expected moves that will further consolidate management duties and control atop the world's No. 2 automaker.
Ford President Nick Scheele, 60, who devised and executed the automaker's latest restructuring, will retire Feb. 1 after 38 years with the automaker. Vice Chairman Allan Gilmour, 70, also will retire that same day. Gilmour was coaxed out of retirement in 2001 as Bill Ford took control of the company's day-to-day operations and built a new team to revive the automaker's fortunes.
With Scheele's retirement, Detroit native Jim Padilla, 58, who was named chief operating officer nine months ago, will add the title of president and join Ford's board of directors. Padilla is now clearly Ford's No. 2 executive behind Chairman and CEO Bill Ford Jr.
Gilmour and Scheele, who tallied a combined 74 years with Ford, helped dig Ford out of the rubble left after the Firestone tire controversy in 2000 and the stormy end of Jacques Nasser's tenure as CEO in 2001.
The silver-haired, smooth-talking Gilmour stepped in as CFO and helped restore Ford's credibility with Wall Street. As one of the country's highest ranking openly gay corporate executives, Gilmour also worked with Ford employee groups to help secure benefits for gay and lesbian workers.
Scheele, a jocular Brit with a flair for public speaking, was drafted in 2001 to quarterback the automaker's "revitalization" plan following a two-year period when the automaker posted losses of $6.4 billion.
"When I became chief executive officer three years ago, I turned to trusted Ford veterans, such as Nick, to help us address a host of difficult operating issues and to steer this company back to the basics of our business," Bill Ford said.
The personnel moves, announced Thursday, were not unexpected.
Bill Ford has set up a line of succession that appears to stretch well into the future - a future rife with challenges including skyrocketing health care costs and brutal competition.
"Jim is a results-driven individual who attracts and empowers the kind of Ford executives we want leading this company," said Ford, great-grandson of Henry Ford and the automaker's chairman.
"He's the right man for the job, and the right man to ensure that in this extremely competitive automotive business, the Ford Motor Co. remains focused on what it needs to do to succeed."
In other moves, Ford Chief Financial Officer Don Leclair, 52, will become an executive vice president effective Jan. 1 and also will oversee Ford Credit.
Analysts were not surprised by the changes.
"It looked like kind of an evolutionary move," said David Healy of Burnham Securities. "It may be kind of a sign that they're finally out of crisis mode."
After shedding 35,000 jobs, cutting its dividend and closing assembly plants during the turnaround, Ford is counting on car and truck models to revive sales and profitability.
"We're now moving into the second phase, which is new-product-led," Scheele said.
The revitalization plan, which was implemented by Padilla, calls for Ford to introduce 65 products in five years. The plan also calls for Ford to further reduce manufacturing capacity and shed non-core businesses.
Ford is poised to make more than $3 billion this year.
"We've demonstrated that the strategy was right," Scheele said. "Would we have done anything different? I don't think so."
With Asian and European automakers entering new product segments and building new U.S. plants, the business climate facing Detroit automakers isn't expected to improve.
Gilmour has spent much of the last year exploring ways to reduce or minimize increases in Ford's health care tab, which reached $3.2 billion last year.
That task now falls to Joe Laymon, group vice president of human resources and labor affairs.
Scheele said soaring health care costs are threatening the auto industry's viability, much like other industries.
"We've got some fairly dreadful specters on the outside -- steel and the airline industry," Scheele said. "They've bounced in and out of Chapter 11. We are, as an industry, one of the key manufacturing industries of the nation. And people say, 'There are a lot of transplants right now.' But it is the domestic three who've made 90 percent of all investments over the last 20 years in automotive."
Padilla has slowly worked his way up the Ford career ladder from the shop floor.
"This opportunity to serve both as a top officer and the company and as a member of its board of directors comes at a time when Ford is blessed with a wealth of talented men and women who have made a long-term commitment to this company," Padilla said.
In other moves announced Thursday:
• Louise Goeser, 51, was promoted from vice president of global quality to president and chief executive officer of Ford of Mexico. She will be replaced by Deborah Coleman, 51.
• Paul Mascarenas will become vice president of vehicle programs in North America product development and Martin Mulloy, 48, was named vice president of labor affairs.
• Lloyd Hansen, 56, will retire as vice president of revenue management.
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