American Icon by Bryce G. Hoffman Read Free Book Online

confronted with financial calamity. He cut and cut deep. In January 2002, he announced that the automaker would close five factories in North America and eliminate more than 21,000 jobs. Ford may have been a man of the people, but he had also promised to do whatever was necessary to save his company. That included reducing dividend payments, amove some in the family complained about. At the same time, Ford went after the trappings of executive excess that had come to symbolize Nasser’s regime. He fired high-priced consultants, told executives to cut back on conspicuous consumption, and replaced the filet mignon and salmon normally served at lunch meetings with sandwiches. He even got rid of some ofthe company’s jets. More important, he refocused Ford on its core business of building and selling cars and trucks. With the battle cry “Back to Basics,” he began extricating Ford from the other ventures that his predecessor had found so much more compelling than manufacturing automobiles. Bill Ford increased product spending, which Nasser had cut to fund his acquisition binge. He ordered a new push to improve quality. And he told veteran engineers that their experience was still valued in Dearborn. He got rid of the bankers who were running Ford Credit into the ground and replaced them with men who understood that its primary function was to support sales. He went to Wall Street and raised $4.5 billion, starred in the company’s television ads, and even tried to take on the automaker’s notoriously noxious culture.
    For years, Ford had hidden its lack of product investment behind cute catchphrases like “cheap and cheerful”—Dearbornese for a bare-bones compact; “fast follower”—code for a car that was essentially a knockoff of what Ford’s competitors already had in their showrooms; and “last in, best dressed”—a rather lame excuse for being the final automaker to enter a particular segment. They were the doublespeak of a company that had learned to justify its own inadequacies, and Ford ordered them banished from the corporate lexicon.
    “How do we get back to product leadership?” he asked his designers and engineers. “As long as those phrases are being bandied about, we never will.”
    He knew Ford could do better. In Europe, it already was. Ford’s products were well regarded on the other side of the Atlantic and the company was even making money off them, which was more than Ford could say about most of its North American cars. Sport utility vehicles and pickups were still profitable, but everything else was at best breaking even.
    “We have relied far too long on a few home runs,” Ford told histeam. “We need to hit a bunch of singles, not swing for the fences. We have to make each vehicle profitable.”
    By the end of 2002, Ford was back in the black. * Warranty costs were down. Ford hadclimbed two slots in the influential J.D. Powers and Associates initial quality survey and was no longer dead last among the world’s major automobile manufacturers. But no one was convinced that Ford had actually turned the corner. The company’s stock dropped below $10 a share for the first time in ten years that fall, and Ford’s credit rating continued to slide. Bill Ford began to feel like the Rodney Dangerfield of the automobile industry. No matter what he did, he could not seem to get any respect.

    H owever, the skeptics were right to be wary. The company may have been making money again, but Bill Ford was struggling.
    After sanctioning his coup d’état in October 2001, the board of directors had hoped that—with a little coaching—Ford would rise to the occasion and become a truly effective chief executive. To make sure that he did, the board asked director Carl Reichardt to mentor the forty-four-year-old. Even at seventy, the former head of Wells Fargo was one of the sharpest financial minds in America. He was a titan of the banking industry from the days when it could still be mentioned in