Ford moves to shore up luxury division

DETROIT -- Ford Motor Co. moved to shore up its luxury car division on Thursday, as part of a wide-ranging management shake-up following last week's ouster of Jacques Nasser.

Ford said Richard Parry-Jones, a veteran and widely respected executive who heads its largest engineering organization, was assuming the added responsibility of leading day-to-day product development at its Premier Automotive Group.

PAG, headed by London-based former BMW executive Wolfgang Reitzle, is Ford's stable of upscale vehicles that includes the Jaguar, Volvo, Land Rover, Lincoln and Aston Martin brands.

Parry-Jones, a native of Wales, will relocate to Britain from Ford's Dearborn, Mich., headquarters and report to both Reitzle and the automaker's new Chief Operating Officer Nick Scheele who was former chairman and CEO of Jaguar.

In a statement released after a monthly meeting of Ford's 15-member board, the world's second largest automaker said its head of global marketing, Jan Klug, would also report to Reitzle.

"Our Premier Automotive Group is a critically important part of our global corporate portfolio and a major engine of growth for the future," Scheele said in the statement.

"With the additional support of Richard and Jan ... Wolfgang is positioning PAG to make a real difference in the luxury segment," he said.

Nasser, once seen as among the best managers Detroit's Big Three automakers have ever had, built PAG and made it a force to be reckoned with through the acquisitions of both Volvo and Land Rover during his nearly three-year reign as Ford's CEO.

But his ouster on Oct. 29 came as Ford -- which industry experts said had lost its focus -- was reeling from the protracted Firestone tire crisis, a string of embarrassing quality glitches and net losses of $1.4 billion in the last two quarters.

'BACK TO THE FUTURE'

By throwing the spotlight on PAG, industry analysts said Ford was clearly seeking to put its recent problems behind it. But it was also signaling that Scheele and William Clay Ford Jr., who added Nasser's responsibilities to his role as chairman last week, have their eyes set squarely on future prizes.

"We are putting together a talented team that is committed to our mission of building the world's best cars and trucks,' Ford Jr. said.

"In my mind the success of PAG is absolutely critical because you've got the baby-boomers moving into their peak car buying years over the next 10 to 15 years," said Michael Brunesteyn of Prudential Securities.

"That's the future," he added. "They need to have PAG in order to carry the entire Ford Motor Company through the next 15 years."

Even in a weak economic environment, industry experts say the increasingly competitive luxury segment is key to the bottom line of Ford, General Motors and other automakers. Aging baby-boomers, following in the footsteps of their parents and great-grandparents, are likely to spend about 30 percent more on their vehicles than people in any other age segment.

RESTRUCTURING IN JANUARY

Industry analysts said a restructuring plan, which may include massive job cuts, was probably the main discussion item when Ford's board met on Wednesday in an undisclosed location somewhere in Dearborn.

Company spokeswoman Anne Marie Gattari said details of the plan were not expected to be made public until January, however.

Among other strategic management moves announced on Thursday, Ford said Bob Dover had been appointed group vice president for Land Rover and Jaguar, whose managing director Jonathan Browning resigned a day after Nasser's ouster.

Ford said it had also named new heads of human resources and global public affairs, replacing two diehard Nasser loyalists who went out with their boss last week.

Copyright 2001 Reuters Limited. Click for restrictions.

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