Ford board to press Mulally on future plans, report says

A source close to Ford's board said media coverage of Mulally's status is drowning out Ford's product news, such as the new Mustang unveiled last week.
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DETROIT (Reuters) -- Ford Motor Co.'s board of directors plans to press CEO Alan Mulally as soon as this week for a decision on his future, as speculation intensifies that he may be offered the CEO post at Microsoft Corp.

Mulally, 68, is one of a handful of candidates still in contention for the Microsoft role, according to several sources close to the technology giant, and he has not directly denied having interest in the job.

That has begun to vex some on Ford's board, two sources told Reuters this week, and the issue was to be discussed when the board met in the Detroit area today. There was no word later in the day if that discussion took place.

Mulally is a member of Ford's board. The sources said that Ford directors intended to raise the issue with him this week or next.

"It's drowning out the rest of the story," said one source close to Ford's board. "People don't write about Mustang, they don't write about earnings, they write about Mulally."

That has led to frustration and a desire for clarity, the source said.

Microsoft declined comment on the progress of its CEO search, and a Ford spokesman repeated earlier statements that Mulally is slated to stay as Ford CEO through 2014, although it emerged in September that the board would be open to him leaving earlier than that.

Ford shares fell by 3 cents today to close at $16.38 a share.

Mulally, speaking to journalists at Ford's annual media holiday party on Thursday evening, again dodged questions about whether the company's board of directors is pressing to clarify his future with the company.

"Nothing has changed," he said. "I love working for Ford. We don't comment on speculation."

Mulally said he called Mary Barra earlier this week to congratulate her on being named CEO of General Motors, succeeding Dan Akerson.

"It's neat," Mulally said of Barra's appointment. Mulally said he also called Akerson and "thanked him for his service" to the industry.

Little said so far

Ford directors so far have said little publicly about Mulally's future.

“Alan is staying through the end of 2014 and that’s all I know,” Edsel Ford II, great-grandson of company founder Henry Ford, said on the sidelines of the introduction of the new Mustang last week.

When asked directly about the situation live on CNBC last week, Mulally sidestepped the question.

Reporter Phil LeBeau then said to Mulally, "You didn't answer my question."

Mulally responded, "I did answer your question. I'm honored to serve Ford."

Several prominent Microsoft investors have campaigned behind the scenes for Mulally to succeed the retiring Steve Ballmer, and media attention has focused on him over the past few months.

Sources with knowledge of the tech company's hunt for a new leader say Mulally is among a "handful" of contenders, and that Microsoft is strongly considering a younger, more tech-savvy external candidate.

Ford exit likely 

Mulally, credited with reviving Ford's fortunes since taking the helm in 2006, has already scaled back his involvement at the automaker this year, allowing younger executives to take a more prominent role, several people close to the automaker said.

Even if Mulally does not take the Microsoft job, it is unlikely he will stay at Ford through the end of next year, the two sources said. The board has gained confidence in COO Mark Fields, a 24-year Ford veteran who is widely expected to be the next CEO.

"He has done what he needs to at Ford," said one person familiar with Mulally's thinking.

Mulally, poached from Boeing Co in 2006 to steer the U.S. automaker's turnaround, is credited with driving a culture change that saved Ford. That has made him an attractive candidate for Microsoft as the tech behemoth struggles to make a mark in the mobile-computing era.

But the speculation over whether he will take the Microsoft job has been a distraction for Ford, the sources said. The automaker is on the cusp of several key launches next year, including a risky and radical overhaul of one of its most profitable vehicles, the F-150 pickup truck.

On top of that, rival General Motors Co. put the topic of auto industry leadership firmly in the spotlight on Tuesday with the surprise announcement that long-time insider Mary Barra would become its next CEO.

Brad Wernle of Automotive News contributed to this report.

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