Ford Nixes Alliance and Brand Selloff - Except Aston Martin

26 October 2006

DEARBOURN, Michigan: Alan Mulally, the new occupant of Ford Motor Company's ceo hotseat, has decided against an alliance with any other auto manufacturer - for the time being at least. Nor, with the exception of UK supercar marque Aston Martin, does he aim to dispose of any major brand assets.

Former Boeing evp Mulally, who joined Ford last month, told the Financial Times he is scaling back the involvement of Kenneth Leet, the ex-Goldman Sachs executive formerly charged with conducting a strategic review of Ford's assets.

Leet's main role hereon is confined to advising on the planned sale of Aston Martin. "Ken's role changed," says Mulally tersely. "All of the analysis concluded that the best value creation for Ford was to turn [the company] around."

He is also considering a revamp of its board of directors. Following the recent departure of former US treasury secretary Robert Rubin, Mulally inferred that Sir John Bond, current chairman of HSBC, also might not be indispensable.

It seems the British banking knight collects his not inconsiderable paycheck for spending an average one day a month 'advising' on the automakers financing unit Ford Credit.

Mulally has four priorities: cutting production capacity in line with eroding market share; accelerating development of cars and fuel-efficient light trucks; securing the company's finances; and breaking down barriers to communication within the company.

Ford is reeling after this week's revelation of its largest quarterly loss in fourteen years - $5.8 billion (€4.42bn; £3.1bn). However, recent investments in Jaguar and Land Rover have started to pay off, claims Mulally: "We're very pleased with the progress they're making."

Data sourced from Financial Times Online; additional content by WARC staff