LONDON -- In announcing the resignation of Premier Automotive Group Chairman Wolfgang Reitzle and the appointment of Mark Fields to succeed him, Ford Motor Co. made it clear last week that its recovery plan will continue to rely heavily on its luxury brands.
Negating speculation that the luxury group had lost its halo within Ford and could be broken up, COO Nick Scheele said he still expects Ford's luxury brands - Volvo, Jaguar, Land Rover, Aston Martin and Lincoln - to account for one-third of Ford Motor's pretax profits of $7 billion by mid-decade.
In 2000, Ford Motor posted pretax income of $8.2 billion, of which the luxury brands accounted for about 20 percent, or some $1.6 billion. If Scheele is correct, pretax profit from the luxury brands will need to grow by about 40 percent to about $2.3 billion in only a few years.
But for that to happen, Premier Automotive will need to quicken the pace of change.
The departure of the 53-year-old Reitzle comes as the brands are working hard to collaborate in the broad areas of purchasing and development while trying not to overlap in branding and product.
It's an area in which many feel Reitzle will be missed because the new boss, the 41-year-old Fields, who moves over from Mazda Motor Corp., doesn't have Reitzle's experience with luxury brands or his product savvy, dynamism or clout.
"We can't afford to lose him," a Premier Automotive manager said.
"It's fascinating what a difference he made at the brands. The attention he gives to the smallest detail, his engineering experience and his understanding of customer tastes and market trends make all the difference," the manager said.
"Cars like the S-Type with a six-speed gearbox wouldn't exist without Reitzle. Now the finance guys will start saving at every single nut and bolt again. And the Jaguar spirit, so credible reinstalled by Reitzle, will fade again," the manager predicted.
But in a conference call with reporters Friday, April 19, Scheele said Fields' success turning around Mazda was due in part to his ability to adjust to different cultures, which makes him the right executive to head Premier Automotive.
In his three years at the helm, Reitzle achieved mixed results at Premier.