DETROIT – To kick off day two of press days at the North American International Auto Show (NAIAS) at Detroit’s Cobo Center Tuesday, Alan Mulally, Ford president and chief executive officer, hosted a Town Hall meeting for media, local college students and business leaders involved in the renaissance of the City of Detroit.
“About seven years ago I got a call from Bill Ford,” said Mulally. “The company was in trouble and he wanted my help.” At that time Mulally was serving as executive vice president of Boeing, a company he had worked with for 37 years. He signed up for the task of turning the Ford business around and decided to face major challenges head on.
“One of the first earnings reports I saw shared 2006 results, which showed a $17 billion loss for the year,” said Mulally. “It was a pretty tough situation and we needed to work quickly to make big decisions.
One of those big decisions involved the birth of the One Ford philosophy in which all team members are working together to achieve very specific goals. Mulally outlined a few of those goals as follows:
- Work together as one globally.
- Expand the business globally.
- Develop a full family of vehicles that offer emotive designs consumers will desire, be best-in-class with each vehicle, and make sure to deliver value.
Mulally took this strategy to the banks and lead the team in mortgaging every company asset including the blue oval itself to secure the $23.5 billion needed to fund the future success of the company.
Additionally, Mulally sanctioned the selling off of several ancillary brands including Land Rover, Jaguar and Volvo in order to focus on building up Ford products.
“Seven years later, we have repaid that loan, Ford Focus is the best-selling vehicle in the world and Ford F-150 has been the best-selling truck in the United States for 37-consecutive years,” said Mulally before opening up the audience question and answers portion of the discussion.
One member of the audience, a representative of Shinola a company that has recently set up shop in Detroit, asked if Mulally could share advice for business owners in Detroit?
“There are many talented people here in Detroit, and that will help you,” said Mulally. “But the most important thing in business is to create value – it’s just not that complicated. Make products consumers want and value.”
Another member of the audience, this time a college student, asked whether Mulally had any personal uncertainty as he merged onto the Ford team?
“Well, I cried a lot and there were a lot of sleepless nights,” Mulally said with a chuckle before sharing one of his favorite stories of how one reporter questioned Mulally’ s capabilities at first. “The reporter said to me, ‘A car is a complicated machine with roughly 10,000 parts. And with all due respect sir, you’re just not a car guy.’” With such a long and successful history at Boeing, Mulally responded by saying a 747 has 10 million parts and manages to stay in the air - implying he had confidence in being able to transition just fine.
Mulally added that he knew Ford had a reputation for attracting extremely talented people – the “whiz kids” he said, and he knew he could rely on their talents to help rebuild the business. “I have never seen a team pull together as quickly as the Ford employees did in those early days, and they continue to do so today which contributes to our ongoing success,” said Mulally.
Another college student asked Mulally how he knew mortgaging the assets and selling off the other brands were the right decisions?
“The most important thing in a dire situation is to be able to really get comfortable with reality,” said Mulally. “We were in tough shape and those were tough decisions, but it was important to deal with reality and come together around a really compelling vision.”
Lastly, a member of the audience asked Mulally what he drives?
“Well I rotate vehicles and test all of the competition as well but my favorites are the Ford Fiesta, Ford Focus, Ford Fusion, Ford Taurus, Ford Mustang, Ford Escape, Ford Explorer, Ford F-150, Ford Transit, Lincoln MKZ, and Lincoln MKC to name a few.”