In the draughty hallway of the former media centre on London’s Olympic Park, Ford’s new boss Jim Hackett is sketching out the future for the 113-year-old company.
Listening in are a small group of staff who will work at the “smart mobility innovation office” he is in the UK to formally open. It’s part of a network of similar bases aimed at positioning the company for the future of motoring – whatever it may be.
Hackett – tieless to fit in with the environment – is confident they will help make Ford a leading player in automotive sector of the 21st Century.
“As the company thinks about its future, it’s certain that it does not have to cede that opportunity to anyone,” he says in his first UK interview.
“It has a right to help interpret that and translate that for people all over the world.” The 62-year-old took over at Ford in May, when predecessor Mark Fields was ousted following investor concern over shares falling by a third during his three-year reign and worries Ford was dropping behind rivals in developing autonomous, connected and electric vehicles.
“We are behind in connectivity,” says Hackett, referring to expectations of a more joined-up world in which the cars of the future will be linked up to internet and infrastructure. Connected cars and “smart mobility” also includes self-driving vehicles and new models of “owning” cars – such as subscription services, shared ownership and ride-sharing.
“But once cars are connected, our software will lead the industry and as customers get digital services, that is an advantage for Ford,” he says.
As with all chief executives, there’s conviction in what Hackett says. Unlike most chief executives, he’s got a physical presence hinting at his college sporting career as a centre for the University of Michigan American football team which makes feel it might not be wise to question his conviction too intensely.
However, he relents slightly, admitting that, when it comes to electric vehicles, “we aren’t where we are going to be”. But this isn’t necessarily a problem – at least for now, according to Hackett.
“There is not a provider of EVs that is profiting from them without support from government or whatever,” he says. “The reason is the cost of the technology is too high for what customers will pay. You can’t really charge them the cost of the system today but I’m optimistic about its role.”
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It’s a solid counterpoint to critics who consistently point to Tesla’s soaring market value – currently $57.6bn (£43.6bn) – having overtaken Ford which lags behind on $48bn. This is despite Ford having decades of experience in the challenging world of car production and last year delivered 6.6m vehicles compared with Tesla’s 76,000.
Nevertheless, with the industry likely facing more change over the next few years than it has seen in the last century, Hackett has got to press the accelerator now to ensure that Ford isn’t lost to history.
Hackett took the top job after four years with Ford: three on the board and one year in charge of the company’s future-gazing smart mobility unit, before being elevated to chief executive. It’s that forward looking role that led to him taking the wheel. Chairman Bill Ford, great-grandson of Henry Ford, called Hackett a “proven transformational leader, a visionary thinker, a futurist” when he was appointed.
“I love the business but I was definitely not hired because I was a ‘car guy’,” says Hackett. Instead he says he’s in the job to “marry myself with some really great car guys and what I understand about the intersection of the use of new technologies by people.”
Hackett earned this forward-looking reputation from his three decade career with office furniture manufacturer Steelcase.
He cemented this reputation after returning to his alma mater and becoming interim director of the University of Michigan’s athletics department in 2014, turning around its struggling football team and revitalising the department.
Hackett believes his new way of thinking can be applied just as well to Ford as furniture or football. “What I do understand really well is the way markets change and the way technology evolves and its use by people,” he says. “We have the prospect in front of us that vehicles will be smarter than anyone ever imagined, so smart you don’t need a driver,” Hackett says. He neatly dismisses the idea that he’s an outsider to the world where “car guys” were needed to run car companies. “Driverless cars were a fantasy back in the day. When car people were running car companies the idea that there might not be a driver would not be a plan they would have been thinking about.”
But, for all his talk of Ford being at the vanguard of a brave new world for motoring, his plans sounded trite rather transformational when he set out his vision for the company following his 100-day review. Costs would be cut by $14bn, $7bn of spending would be shifted away from saloon cars to strong-selling SUVs and trucks, and $500m towards electric vehicles. Ford’s share price failed to react and there were questions about the vagueness of the slides in his presentation, with criticisms over their lack of figures and comparisons to the big – but sketchy – ideas beloved of management consultants.
However, maybe this is what Bill Ford was looking for in Hackett. When a future is still uncertain, committing to a certain path could be a company-killing mistake. Hackett says he is taking action, though. “If you try to time the point when the market has tipped it has already left you.”
He says his role at Ford is “helping [colleagues] see themselves the way they are now and in the future”.
It’s a lot to take on board for Ford’s 200,000 employees, especially when Hackett notes the company is having to “adapt to the forces of what I am calling deep learning in vehicles”, referring to the step-changes in the complexity of cars as they become more computerised.
“It’s a force unlike any force the industry has had in modern times,” he says. “It basically means that the amount of data a vehicle can have overwhelms every sense.”
Hackett has been described as a “cheerleader in chief, a coach” who can get the company to believe in itself and its future and do things that the previous chief executive couldn’t.
He believes that Ford can handle the unprecedented change in the industry.
“We have some real skills in that,” Hackett says. “We have done that over history.”
Lives: Grand Rapids, Michigan
Family: Married, two children
Education: University of Michigan
Career: Served as chief executive of US office furniture company Steelcase from 1994 to 2014. He joined Ford’s board of directors in 2013 and became chairman of Ford Smart Mobility in March 2016. Became president and chief executive of the Ford Motor Company in May 2017.
Interests: American Football – interim director of athletics at University of Michigan in 2014