Ford Motor executive Joe Hinrichs will retire and the company is naming Jim Farley as chief operating officer, the automaker said in a surprise announcement Friday.
It said Farley, currently chief of new business and technology, will take over broader responsibilities from Hinrichs, who is president of the automotive division. Those responsibilities include all global markets and automotive, the company said. Farley will continue reporting to President and CEO Jim Hackett, who has been under fire from Wall Street regarding progress on an $11 billion global restructuring plan.
Shares of the company dropped to a new 52-week low Friday morning before recovering to $8.11 per share, down about 1.7%. Ford stock is down less than 1% in the past year but has fallen 11.3% in 2020.
Hinrich's departure is unexpected. Despite the company calling it a retirement, Hackett made it seem he didn't believe Hinrich's career was over: "Joe's going to have a wonderful career," the CEO told reporters. Hinrichs, 53, was not available for comment.
Hinrichs was at the White House on Jan. 29 representing the automaker as President Donald Trump signed the United States-Mexico-Canada Agreement. He also was on the automaker's fourth-quarter earnings call with investors on Tuesday.
The 19-year Ford veteran was well-liked in the company and a leader for Ford's manufacturing operations, including during contract negotiations last year with the United Auto Workers and for key vehicle launches in recent years such as the aluminum-bodied F-150 pickup. However, the automaker botched the launch of its redesigned Ford Explorer SUV last year due to personnel problems and quality issues after redoing the entire Chicago plant that builds the vehicle.
Hackett, calling Hinrichs a "really good friend and accomplished global leader," said the Explorer launch was a "company issue" and the leadership change is "not tied to that at all."
"This is something I started to work on more than a year ago, as we built the organization that we were in, which was to see how a company like Ford could straddle these two eras," Hackett said during a Friday morning call with reporters, referring to its traditional automotive business and future mobility efforts.
Hackett said the leadership change, which gives Farley far-reaching oversight, will assist the automaker in executing the global restructuring. Despite losing Hinrichs, Hackett said he's confident the company "won't miss a beat" as it prepares for significant launches such as the redesigned F-150, Ford Bronco and Ford Mustang Mach-e.
"I see Jim as a partner to work together to unite the Ford businesses now so we can move swiftly to take advantage of opportunities that are associated with this new S-curve," Hackett said. "Fully integrating our vehicles with our rapidly evolving technologies and capabilities ... there will be no chasm in this relationship in between all those capabilities and that's the advantage we get with this move."
Farley will retain leadership of Ford Smart Mobility, Ford's autonomous vehicle operations and the company's partnership with Argo AI, a Pittsburgh-based autonomous vehicle firm.
Farley, 57, joined Ford in 2007 as global head of marketing and sales from Toyota Motor's Lexus brand. He's led Ford's Lincoln luxury brand, Ford South America, Ford of Europe and all of the company's global markets. Since April, Farley has led Ford's new businesses, technology & strategy team.
Ford also announced Hau Thai-Tang, chief product development and purchasing officer, will take on an expanded role, reporting to Farley. Thai-Tang, 53, will continue to lead product development and purchasing, while adding responsibility for enterprise product line management and connectivity.
Hackett, in a statement, thanked Hinrichs "for his tremendous leadership over the past two decades."
The changes are effective March 1.