Why Former Ford CEO Mark Fields Is “Out” And Tesla’s Musk Is So “In”

MAY 24 2017 BY TESLAMONDO 55

WHY MUSK IS SO “IN” AND FIELDS SO “OUT”

Elon Musk

Tesla CEO Elon Musk (Image Credit; flickr via Brad Holt)

Tesla’s irrational valuation and Mark Fields’ irrational ouster both stem from the same thing: decades of alienation between legacy automakers and the public. A lot of consumers consider big automakers boorish and auto dealers beyond boorish, but had nowhere to turn until lately. Tesla represents a long overdue agent of change in an industry considered padlocked to newcomers. Investors like the story.

Therefore, Musk sells a few cars and gets hoisted onto investors’ shoulders and marched around the stadium while Fields gets tarred and feathered in the parking lot for simply conducting business as usual. Business as usual is simply finished, especially auto business as usual. How Jim Hackett, a 62-year-old furniture designer, will steer Ford through a sea change in mobility and leapfrog Musk et al remains to be seen.

TeslaMondo thinks the Fields ouster will lead to more shakeups as Big Auto struggles with the Tesla “drop in the bucket” that’s turning into a tsunami. It’s no accident that this is happening just as Model III debuts. The press may refer to spooky mobility overtures by Google and Apple, but those are still abstract. Tesla is concrete.

Ford’s New CEO

Tesla is doing to autos what Amazon is doing to retail, for the same reasons. People generally don’t have a great time at retail stores. The layout sucks. The help sucks. The parking lot sucks. The elapsed time sucks. So they’re keen to ditch the whole scene and try “cloud retail.” Do you have a meaningful relationship with your insurance agent? Probably not, hence the advent of “cloud insurance” like GEICO, Progressive etc.Do you feel good about auto companies, despite a steady drumbeat of news about trying to skirt recalls, sidestep warranty claims, fudge fuel economy, fudge emissions, retard fuel economy mandates, ignore longstanding problems like the Ford Focus transmission?

How about auto dealers? Do you feel good about them?

So the industry deserves comeuppance. It’s been a long time coming. Who should be next to go? How ’bout Sergio Marchionne, who begs everyone to avoid his electric Fiat compliance car, but will tinkle with glee if you buy a Jeep or a Heck Cat? Sounds like a CEO of the automotive past, not future. How about Akio Toyoda, who foolishly put his chips on fuel cells and hybrids and thereby set Toyota back almost a decade in cultivating the next-level EV tech that Tesla, a mere rookie, now defines.

If Fields is out, why are they still in?

*Editor’s Note: This and other Tesla-related posts appear on TeslaMondo. Check it out here.

Categories: Ford, Tesla

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55 Comments on "Why Former Ford CEO Mark Fields Is “Out” And Tesla’s Musk Is So “In”"

newest oldest most voted
KevinZ

Great story, impressive writing.

Dav8or
Yeah, great story, but that’s all it is. Just a story. Ford’s pick for their new CEO clearly shows they feel zero pressure from Elon Musk, or Tesla, or electric cars. This article is just an excuse for a Tesla fan rant. Juts another- “Oooooh! Elon’s really got ’em now!!” kind of thing. The same sort of op ed articles we’ve been reading for at least seven years now. If Ford was really worried about lack of innovation, or lack of an electric vehicle portfolio, do you think they would have named this guy as CEO? Like others have said, he looks like he’s out of a Dilbert cartoon and likely just as dynamic as he looks. A background in finance and his big accomplishment in life so far is moving American jobs to China. He was in such high demand as a CEO, that he stayed at an office furniture company for his entire career… until now. No, Ford isn’t getting ready to make more profits by coming up with innovative new electric cars for the future, rather they are going to make more profit the old fashion way. Eliminate jobs, move the remaining jobs to China and bank… Read more »
mx

Fields got fired after, not before, he showed his layoff hand.
Bill Ford probably didn’t see that as “innovative”.

CLIVE

Love it.

Go figure. I wish them all the best.

Longvsshort

There’s always a point where the hype around something becomes annoying, and the underdog becomes the top dog and vice versa. I can see Ford and GM being seen as champions of the true and tested soon enough, while the Tesla hype will make many people tire soon enough. Make no mistake, Elon Musk is nothing short of a hero of change. But everything is what it is. Ten million cars produced per year is one thing. A hundred thousand going towards half a million is another. That doesn’t mean Tesla’s glory days has passed. Just like Apple is making record profits a decade after the introduction of the iPhone. But the spark is gone. Tesla’s problem is too much exposition.

jelloslug

If Tesla was still struggling to sell 10k cars a year or had no real plans for the future I would agree. They are not though and they are forcing the hand of all the other manufacturers. That’s not hype, that’s progress.

GeorgeS

Way to take the bait jello.PTNFTT

Longvsshort

To only force the hand of the other automakers to go “electric” is more than good enough “on the whole”. The fate of Tesla itself on the other hand, is very uncertain. Just like the Apple logo has become little more than a try-hard status symbol while Android smartphones provide the same value at a fraction of the cost. Legacy automakers with much more resources to spend are bound to catch up on a technical level. Or have already.

ffbj

Not such a good analogy since Apple is at all time highs. Tesla has already won dude. Losers just can’t figure it out. Which is not too surprising.

CLIVE

You try harder…

Apple has more money than God.

mx

I’d agree if I didn’t see factory plant and equipment at Tesla grow form 1 Billion to 16 Billion in 4 years.

They are now, and will continue to out vertical integrate the legacy automakers.

pjwood1

Also like the story, very realistic take on a HOT subject.

RE: Tesla “concrete” (and Longvsshort). It must be terrifying to consider how fast market share might shift. This week came another story pointing out that Tesla is on a path to do in 3 years, what took Porsche 10: go from 35k production, to >100K, annually. They were seriously not banking on what might come true.

I don’t think Tesla’s problem is too much “exposition”, accepting Musk’s love for passengers. I think he shrewdly dials it, and is somewhat defining the market as he takes advantage of his long leash. I wish AI and electrification weren’t conflated, but it’s an outcome all makers seem happy with.

Longvsshort

The word should have been “exposure”, of course, and nothing else.

GeorgeS

Oops.

Peter

iPhone spark is gone ???
I don’t think so.

Mark.ca

Yeah, they keep turning record profits on the iphone but the spark is gone beacuse he has an android. Ok

Dave8y

If Hackett’s past is designing furniture, then that is not what Ford needs as CEO.

Given how the auto industry will change this next decade, auto companies would be best lead by ‘technology’ people. Elin Musk is a great example of this. Mary Barra, an engineer herself (although may never have been a design engineer), should be servicable.

GeorgeS

Yeh. Not sure the new guy is what they need either. He looks like someone right out of a Dilbert comic strip

AlphaEdge

He was the CEO of the company for 20 years, and instrumental in turning it around, not the head designer.

Dave86

Don’t care if he designed furniture, ran the company, or did both for 20 years. That’s not what Ford needs.

Ford needs a leader who knows high technology, is comfortable with it, and can lead a company through a time when there will be great technology changes in the core product. This leader needs to be able to pick winning technologies (EV) and avoid the losers (hydrogen fuel cells). Also, this leader needs to make sure the management structure below can handle technology decisions.

Elin Musk can lead a car company through the upcoming change. Doubt the guy a Ford can.

CLIVE

Ford needed a leader.

Clearly Hackett is in for many reasons.

The Mold for today’s CEO’s is being replaced.

SJC

People hate car dealers, that is why Saturn’s sales program was effective, no haggle no pressure. Fields was just a salesman that could not do the job.

EVA-01

Saturn still used dealers, even if they agreed to no haggle pricing.

CLIVE

GM screwed their dealers, and the one-price shopping did not stop the dealers form screwing the customers by stealing their trade-in. Horrible cars anyway.

SJC

My point IS a better way worked.

Eco

When I first read the story about Ford’s “Mark Fields” getting booted out I immediately thought of Fiat-Chrysler’s “Sergio Marchionne” but not Toyota’s “Akio Toyoda”.

Perhaps we should have a poll on who’s next and when at other legacy automakers.

Kdawg

UofM alum who played football there too.
———-
“Hackett is a 1977 graduate of the University of Michigan, where he played center on the football team. He holds a bachelor’s degree in finance.”

Looks like he is a company downsizer too, so expect a lot of heads to roll at Ford in the next few years.
———-
“In 1994, Hackett was named CEO of Steelcase at age 39, making him the youngest leader in the history of the company. He held the position for nearly twenty years before retiring in 2014. During his tenure, the company eliminated nearly 12,000 employees as part of a downsizing and restructuring of the business.”

GeorgeS

Wow a Steelcase executive how forward thinking.

ffbj

He foresaw the death of the cubicle, which demonstrates forward thinking. So I think he will have to apply some of that to Ford, which has been living in the past too long.

mx

So, Ford is going to downsize to profitability?

Well, I didn’t think Ford Shareholders would stomach a large investment across the board to convert their whole line to EV tech. And if they don’t their dead.

So, they’re dead.

(⌐■_■) Trollnonymous

Ford can afford to lose the compact and medium sized cars. They can survive with their sales of SUV’s and Pickups until an affordable EV SUV and Pickup is available.

mx

Clock, ticking.
Tesla and Workhorse.

Mike

Fields demonstrated a lack of common sense when he whined about mileage standards. You don’t alienate current and future customers by saying something devisive when you could have just kept your month shut. Ford is dead to me.

GeorgeS

Right. And mary barra followed right along. Sergio’s head is going to roll next. By the time the US is done with Chrysler sergio will think electric cars weren’t so expensive after all.

ffbj

Amen, brother.

Get Real

The major reason that Fields is out and Elon Musk is celebrated is because Fields TALKED about the future but wasn’t delivering.

In comparison, Elon Musk IS delivering the future so quickly that Tesla is starting to rapidly disrupt what was becoming a rather stagnant industry.

I expect that other heads will soon roll across the entire legacy OEMs too.

Jim Bartley

“If Hackett’s past is designing furniture, then that is not what Ford needs as CEO.”

Of course it isn’t what they need. It is, however, just what they deserve. More dead wood to play around with. While Ford tries to nail it, it is plane to see that they’ll end up getting screwed.

Kdawg

Most of Steelcase’s office furniture is made of steel, thus the name.

Davek

Are we not allowed to use the word “hell” anymore? Or does Chrysler really have a product called the “Heck Cat?

Kdawg

Shut the Front door!

MikeM

Reminds me of the little red devil Dilbert character and his “I Darn you to Heck”.

I used to think that was just for fun.
But maybe it was editorial policy not to offend the delicate sensibilities of America’s God’n’Guns crowd.

CLIVE

Good Lord

This article misreads Field’s firing the same way Field’s misreading of the fall of Ford’s stock price got him fired.

Fields was fired because he did a round of layoffs under the pretext that Ford’s falling stock price was because they weren’t earning enough profit.

I think the stock price is falling because they’re fighting innovation instead of embracing it. Do I think Tesla is really worth more than GM or Ford? Only until Ford and GM pull their heads out of their rear and get on the EV bandwagon instead of these half-hearted attempts. When Ford or GM builds a gigafactory (alone or in partnership with battery manufacturers) to build batteries for 500,000 cars a year then they maybe investors will have a more optimistic view of Ford and GM.

pjwood1

FWIW, I think you’re right about Fields “10%” layoffs vs. innovation, but another consideration is the shareholders simply aren’t the same. If F stopped its dividend, AARP would go ‘activist’. TSLA neither retains earnings nor pays out, and its customers crowd-fund hundreds of millions in reservation liquidity. What a TSLA board tells TSLA (Musk) to do, isn’t what a Ford board tells Ford to do, and I think that will keep Ford waking up in the F150. Besides, who likes it when board rooms get smelly.

Jason

Apart from cost (and it is already extensive, so maybe not so much a problem), I don’t understand why Ford hasn’t electrified the F150 or F250. They are big vehicles with seemingly plenty of space, it should be one of the easiest conversions for them to do, lucrative of done properly, and something the market seems to be asking for.
If Workhorse can do it, you would think Ford would easily be able to do it.
Don’t really care why their CEO got fired, if it was a football team no one would think twice. Don’t perform and get the boot, they get paid a LOT of money to bring results.

Pushmi-Pullyu

“I don’t understand why Ford hasn’t electrified the F150 or F250.”

It’s pretty simple. Legacy auto makers have had a century to reduce costs on making gasmobiles and diesel-burners, so their profit margin is much better than it is for EVs, a technology which is still in its infancy.

So why would any legacy auto maker want to spend its resources on building EV versions of their vehicles which would both cut into their own more lucrative gasmobile sales, and result in a lower profit margin?

It’s the same reason that market leaders always resist transitioning to the new tech during a disruptive tech revolution. It’s why Eastman Kodak, former market leader in selling cameras, went bankrupt during the digital camera revolution, and is now selling to only a couple of tiny niche markets.

Doggydogworld

I know a bunch of people with pickups. They all use them to tow stuff. Boats, RVs, horse trailers, etc. Often for hundreds of miles, sometimes 1000 or more.

If we wired up our highways and offered dynamic charging then EV pickups would make a lot of sense. Otherwise, they’re only good for niche applications.

AlphaEdge

Within 10 years, Ford will be a star player in the auto field, thanks to Jim Hackett.

I’m not a fan of Ford, but I’m glad they made this decision. They are clearly lagging in the changing marketplace, and have some catching up to do.

ModernMarvelFan

Well, I wouldn’t put too much into it.

Ford is replacing CEO like how they are managing the Detroit Lions…

Mn

Ford used to have a F-150 NICD 1 gen, pretty good truck gave 80 Miles on a single charge,
they can try and develop a 300 mile F-150, using latest technology.

wavelet

I didn’t know this, but turns out Fields kept on living in his home in South Florida while CEO, and commuted from Detroit there every weekends by private jet… I have no idea how the board allowed this, but it’s pretty clear you can’t provide fulltime leadership like that, even ignoring the cost (~$1M/year). After it was made public and criticised, he started taking commercial flights (still on Ford’s dime), but obviously that’s no better.

CLIVE

What a waste.

How stupid that was.

He clearly wasn’t on-board 100%.

Pushmi-Pullyu

TeslaMondo “stories”, or more accurately blog posts, are often amusing and entertaining, but rarely informative. This one is no exception.

I very seriously doubt that most investors in Tesla stock invested because they hate the experience at their local auto dealer. Sure, that’s an experience most people find about as pleasant as a visit to their dentist, but that’s not why people invest in stocks.

I don’t know anything about the change in leadership at Ford, but it wouldn’t surprise me at all if the TeslaMondo blogger got that wrong, too. I’m certainly not going to take his word for it.

CLIVE

I can tell you this, Mark Fields made himself out to be a complete idiot of a leader in a matter of no time.

Math Is Hard

Ford is making a mistake. While there is a future in autonomous cars it is decades away. It is simple math, if the technology was available today and it is not, and full production lines in place it would still take 15 years to have a 50% market share in autonomous vehicles. Should Ford prepare for the day when autonomous vehicles are what the market demands, yes. But if Ford wants to have a profit stream to support the development of autonomous vehicles it better start to produce reliable cars and trucks that today’s consumers want. Gas is cheap and it will be cheap for the next 10 – 15 years. Electric and hybrid cars have been around for at least a decade and they have a whopping 2% of the market. Understand the market if you want to remain part of the market.