DETROIT - Ford Motor Credit Co. President Mike Bannister will oversee new cost-cutting initiatives at the captive finance unit.
Ford Credit appointed Bannister president and COO last week and revealed that widespread cost reductions are on the way. Ford wouldn't reveal cost-cutting targets, but The Detroit News last week reported that Ford Credit aims to reduce its personnel costs by more than 15 percent by the end of 2004.
Ford Credit has about 20,000 employees worldwide. In the first half of 2003, Ford Credit posted net income of $843 million - about 64 percent of Ford Motor Co.'s net income during the period.
Involuntary layoffs will be a last resort, Ford spokeswoman Marcey Evans says. Ford Credit instead will focus on trimming expenses using attrition and hiring freezes. The initiative is part of Ford Motor Co.'s goal to reduce white-collar employment costs by 10 percent this year and cut total operating costs by $2.5 billion for 2003. Ford Credit has more time; officials expect to complete the restructuring in 12 to 18 months.
Bannister, 53, has spent nearly 30 years at Ford Credit and most recently was president of Ford Credit's international operations. He also has been chairman of Ford Credit Europe.
Ford Credit chief Greg Smith, 51, gives up his title as president to Bannister but remains chairman and CEO. John Noone, formerly executive vice president of North America diversified and major accounts, takes Bannister's previous role as president of Ford Credit international operations. A.J. Wagner absorbs Noone's responsibilities and moves from executive vice president of Ford Credit North America to president of Ford Credit North America.