“American Icon” details’s near-death experience and subsequent turnaround under CEO Alan Mulally, concluding the auto maker made its own breaks.
As my father would say, it’s better to be lucky than good.
And that’s mostly how’s decision to put up nearly all of its assets as collateral to secure a $23.5 billion credit line just ahead of the financial market’s collapse in 2008 has been viewed: More happy accident than management genius.
But sometimes you have to be good to be lucky.
That’s the compelling case laid out by author and Detroit Newsbeat writer Bryce G. Hoffman in a new book “American Icon – Alan Mulally And The Fight To SaveMotor Company.” Hoffman concludes some smart moves, foresight and head-on acceptance of a painful reality had more to do with the auto maker’s comeback than simply good timing.
The book chronicles a critical decade at Ford, beginning with Bill Ford’s ascent to chairman in 1999, his ensuing power struggle with CEO Jac Nasser, subsequent failure to pilot the auto maker through a severe downturn and his ultimate game-saving play to hire former Boeing turnaround specialist Alan Mulally to run the show.
Of course, having the money to exercise Mulally’s product-fueled comeback plan was a critical piece. At the time, most saw Ford’s financial gamble as just that, a roll of the dice by a company that looked to be in the worst shape of any of the Detroit Three. The auto maker mortgaged nearly everything it could, including the Ford blue oval, in an all-in bet to save itself.
Hoffman doesn’t suggest Ford foresaw the size of the wallop the financial-market collapse would deliver to the auto industry when it lined up what it liked to call the world’s largest home-improvement loan. But company officials did detect a downturn on the horizon and worried credit would become harder to find if they didn’t act fast, the author says. Unlikeand its doomed CEO Rick Wagoner, who never thought he’d run out of time, Ford heard the clock ticking.
More importantly, as Mulally brought his outsider’s eye to the task, the auto maker began to face up to the harsh realities its cross-town rivals still were hoping to avoid, moving quickly to sell off or shut down brands, consolidate its global product lineup and engineer breakthrough competitive labor deals with the United Auto Workers union.
As subsequent bankruptcies at GM andseemed to prove, Ford wasn’t the lone canary in the coal mine, it simply was the first one to notice the air had gone stale.
“American Icon” offers a page-turning, behind-the-scenes look at how Mulally slowly, but confidently transforms a Ford culture legendary for spectacular turf battles into a unified team that pulls together under the most severe market conditions in its history to recapture lost ground with car buyers and change the ink from red to black.
Most of the story comes right out of the daily press. But for anyone who missed it or has the stomach to relive Detroit’s darkest days, Hoffman provides a cohesive narrative that fills in the blanks and connects all the dots.
The book does tilt in Ford’s favor a bit. There are suggestions not everyone inside the Glass House is fully onboard with Mulally’s game plan, at least early on. But with the possible exception of stumbling through some Congressional testimony during the government’s bailout hearings, “American Icon” doesn’t find much to criticize or question.
Even Mulally’s largely lateral move to goose Five Hundred sedan sales by reviving the Taurus name comes off as a brilliant stroke here.
Chairman Bill Ford, who at first engineers a successful coup d’état for the top job and then clings to power much too long, salvages his reputation at the end by stepping aside so Mulally can work his magic. And villains in the book are limited to executives like Nasser, who do their damage and then quietly are ushered off the stage.
But considering how far Ford has come under Mulally, any criticism might have seemed like nitpicking.
Ford won’t be out of the woods fully until its 66-year-old CEO calls it a career, power is transferred smoothly and the auto maker proves this latest brush with death has taught it some permanent lessons, Hoffman notes.
One way or the other, it should make for some compelling theater.