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DETROIT — Ford president and CEO Jacques Nasser now will answer more often to chairman William Clay Ford Jr., giving rise to speculation that Nasser’s power at the world’s No. 2 automaker is eroding.
Jacques Nasser, Ford’s president and CEO and William Clay Ford Jr., chairman of the board, address media during a news conference May 22 in Dearborn, Mich. A new plan unveiled Thursday by the automaker will force Nasser and Ford to work together on a more frequent and consistent basis.
The company announced Thursday the creation of the Office of the Chairman and CEO, a new corporate structure in the executive suite that will force Nasser and Ford to meet more often than they had previously done, according to Ford spokesman James Vella.
“This new office strengthens our working relationship and allows us to react even more quickly to address the key issues facing the business,” Nasser said in a statement.
Both Ford and Nasser were not available for comment. Both men have held their respective positions since Jan. 1, 1999. Ford is the great-grandson of the company’s founder and namesake, Henry Ford.
The creation of the new top office comes after a tough year for the Dearborn, Mich.-based Ford.
The safety of the Explorer, its best-selling sport utility vehicle, came into question after several rollover accidents followed tread separations in Firestone tires. The tire company said the design of the Explorer was partially to blame for the injuries and deaths that occurred after the tires failed. Ford says the tires are entirely to blame.
Firestone began a recall of 6.5 million tires last summer.
The company’s public feud with Firestone and its parent, Bridgestone/Firestone Inc., ended their 96-year relationship. In May, Ford said it would spend $3 billion to replace another 13 million Firestone tires.
It was Nasser who testified twice before congressional committees looking into safety issues regarding Firestone tires and Ford Explorers. Nasser also answered to reporters and securities analysts after two highly regarded industry reports said Ford had slipped in both productivity at its assembly plants and in quality.
While the company frames the creation of the new office as a mere formalization of what had been an irregular schedule of meetings between Ford’s top two executives, industry analysts are split on the underlying meaning.
“It will allow Nasser to focus on developing, building and marketing cars, something he is very good at. Bill Ford can work to improve relationships with various constituencies,” said Stephen Girsky, an analyst at the investment firm Morgan Stanley Dean Witter. “We consider this a positive event.”
Michael Flynn, the director of the Office for the Study of Automotive Transportation at the University of Michigan, said he believes this new arrangement is merely the next step in a power-sharing arrangement that had been in progress for some time.
“It’s less of a leash-tightening than a way to get Nasser off the hot seat,” said Flynn. “I think in the future you’ll see public comments from both of them instead of just Nasser.”
But others sees the creation of the new office as a degradation of Nasser’s standing.
“The creation of the Office of the Chairman and CEO is a subtle a loss of power for Jacques Nasser reflecting board dissatisfaction with the company’s recent performance in light of product quality issues, the Firestone tire situation, market place performance and weakened financial position,” said Efraim Levy, senior auto analyst for Standard and Poor’s.
Ford spokesman Vella said the creation of the new office should in no way reflect any sort of leash-tightening or disappointment with Nasser.
“Jacques is still president and CEO, and that role does not change,” Vella said.
Vella said Ford and Nasser came up with the idea after the board of directors asked them if a “more formalized process” was necessary to strengthen the management structure. It is a continuation of the management shake-up announced earlier this month, Vella said.
Jacques Nasser, Ford’s president and CEO and William Clay Ford Jr., chairman of the board, address media during a news conference May 22 in Dearborn, Mich. A new plan unveiled Thursday by the automaker will force Nasser and Ford to work together on a more frequent and consistent basis.
The company announced Thursday the creation of the Office of the Chairman and CEO, a new corporate structure in the executive suite that will force Nasser and Ford to meet more often than they had previously done, according to Ford spokesman James Vella.
“This new office strengthens our working relationship and allows us to react even more quickly to address the key issues facing the business,” Nasser said in a statement.
Both Ford and Nasser were not available for comment. Both men have held their respective positions since Jan. 1, 1999. Ford is the great-grandson of the company’s founder and namesake, Henry Ford.
The creation of the new top office comes after a tough year for the Dearborn, Mich.-based Ford.
The safety of the Explorer, its best-selling sport utility vehicle, came into question after several rollover accidents followed tread separations in Firestone tires. The tire company said the design of the Explorer was partially to blame for the injuries and deaths that occurred after the tires failed. Ford says the tires are entirely to blame.
Firestone began a recall of 6.5 million tires last summer.
The company’s public feud with Firestone and its parent, Bridgestone/Firestone Inc., ended their 96-year relationship. In May, Ford said it would spend $3 billion to replace another 13 million Firestone tires.
It was Nasser who testified twice before congressional committees looking into safety issues regarding Firestone tires and Ford Explorers. Nasser also answered to reporters and securities analysts after two highly regarded industry reports said Ford had slipped in both productivity at its assembly plants and in quality.
While the company frames the creation of the new office as a mere formalization of what had been an irregular schedule of meetings between Ford’s top two executives, industry analysts are split on the underlying meaning.
“It will allow Nasser to focus on developing, building and marketing cars, something he is very good at. Bill Ford can work to improve relationships with various constituencies,” said Stephen Girsky, an analyst at the investment firm Morgan Stanley Dean Witter. “We consider this a positive event.”
Michael Flynn, the director of the Office for the Study of Automotive Transportation at the University of Michigan, said he believes this new arrangement is merely the next step in a power-sharing arrangement that had been in progress for some time.
“It’s less of a leash-tightening than a way to get Nasser off the hot seat,” said Flynn. “I think in the future you’ll see public comments from both of them instead of just Nasser.”
But others sees the creation of the new office as a degradation of Nasser’s standing.
“The creation of the Office of the Chairman and CEO is a subtle a loss of power for Jacques Nasser reflecting board dissatisfaction with the company’s recent performance in light of product quality issues, the Firestone tire situation, market place performance and weakened financial position,” said Efraim Levy, senior auto analyst for Standard and Poor’s.
Ford spokesman Vella said the creation of the new office should in no way reflect any sort of leash-tightening or disappointment with Nasser.
“Jacques is still president and CEO, and that role does not change,” Vella said.
Vella said Ford and Nasser came up with the idea after the board of directors asked them if a “more formalized process” was necessary to strengthen the management structure. It is a continuation of the management shake-up announced earlier this month, Vella said.
