New Ford CEO makes first big management change

07/23/2014 9:29 AM

07/23/2014 10:12 AM

Mark Fields, Ford Motor Co.’s chief executive officer, named a new head of its Lincoln line, replacing Jim Farley, the former Lexus executive who remains the company’s global marketing chief.

In his first personnel moves since becoming CEO July 1, Fields appointed Kumar Galhotra president of Lincoln effective Sept. 1. Galhotra, currently Ford’s vice president of engineering, takes up the task from Farley to turn around Lincoln, where sales have fallen 65 percent from a 1990 peak.

Farley, 52, who came to Ford from Toyota Motor Corp. in 2007, was once considered a contender for the top job at the automaker. Fields, 53, and Farley share a background in marketing and luxury cars. They worked together to convince former Ford CEO Alan Mulally the Lincoln brand was worth saving when he suggested killing it last year, people familiar with the matter have said. Farley retains his title of executive vice president of global marketing, sales and service.

“He will very much still be involved with developing the Ford and Lincoln brand, that hasn’t changed,” Susan Krusel, a company spokeswoman, said in an interview. “He’ll just be solely dedicated to marketing, sales and service.”

Farley recommended to Fields, Executive Chairman Bill Ford and the automaker’s board of directors that Lincoln needed a new leader solely focused on rebuilding the line, Krusel said. Lincoln is in the middle of introducing four new models aimed at reviving the brand, including the MKC small sport-utility vehicle. Later this year, the MKC and other Lincolns will go on sale in China.

Farley became head of Lincoln in December 2012 when Fields moved up to chief operating officer and became the heir apparent to Mulally, who retired July 1. Farley led Lincoln while also having responsibility for Ford’s overall global marketing, sales and service.

Farley “has been doing both jobs and now Lincoln has some product and sales momentum under its belt, it’s taking on global products and new dealers in China,” Krusel said. “The business felt it was the right time to have a dedicated leader for the brand.”

Lincoln’s U.S. sales rose 16 percent in the first half of this year, compared with a year earlier when sales fell to a 32- year low. Lincoln ranks eighth among luxury brands sold in the U.S. and it’s outsold by almost two-to-one by General Motor Co.’s Cadillac luxury line. A year’s worth of Lincoln sales would not fill half a Ford factory.

Ford has invested $1 billion overhauling its Lincoln lineup with models that appear less like chromed up versions of everyday Ford cars. Lincoln, though, is nowhere near contributing to Ford’s bottom line, said the people, who asked not to be identified revealing internal discussions.

Galhotra, a 25-year company veteran, has overseen the engineering development of Lincoln’s new models, which also include a restyled Navigator large SUV coming later this year, the mid-sized MKX SUV debuting next year and a replacement for its large MKS sedan after that. As head of Lincoln, Galhotra will report directly to Fields.

The change in leadership in Ford’s luxury line “is designed to accelerate Lincoln even further as a world-class luxury brand,” the company said in a statement yesterday.

The move should “make clear we are serious about Lincoln as a world-class luxury brand and that product excellence and innovation are what will deliver growth and define our entire company going forward,” Fields said in the statement.

Ford also announced the retirement of Paul Mascarenas, 53, the company’s chief technical officer and vice president of research and advanced engineering. He is being succeeded by Ken Washington, who comes to Ford from Lockheed Martin Corp., where he was vice president of its Space Technology Advanced Research & Development Laboratories.


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