When does an asset become a liability?

That’s the question Ford CEO Bill Ford Jr. had to be wrestling with as he mulled over whether to try and keep Wolfgang Reitzle or let the head of Ford’s Premier Automotive Group (PAG) luxury division walk out the door.

Reitzle exited Ford in mid April to take the top job with German industrial engineering firm Linde.

Reitzle came to Ford in 1999 from BMW, where he was credited with shepherding some of the finest luxury/performance sedans into production.

His mission at Ford was to do the same for PAG, a collection that includes Lincoln, plus the acquired upscale brands of Volvo, Jaguar, Land Rover and Aston Martin. Wall Street considers PAG Ford’s best shot at achieving solid financial success, and Reitzle largely was seen as the critical force behind PAG.

So losing the German executive isn’t something Bill Ford would let happen without a fight – unless keeping Reitzle was seen as an even bigger risk.

Bill Ford says that, in the end, the offer to be CEO of a German corporation such as Linde was just too big an opportunity for Reitzle. But that’s just semantics. It is clear by the number of days – weeks, really – that rumors swirled of Reitzle’s imminent departure, that the PAG chief was waiting for a counter offer too good to refuse.

In the end, that didn’t come, and Reitzle had no choice but to leave.

Rumors played out in the press suggest Reitzle was campaigning to become Ford’s official "car czar," a position similar to the one filled by Bob Lutz at General Motors. Like Lutz, who is vice chairman at GM, Reitzle would have required a lofty title designating him the No.2 guy at Ford with a direct reporting line to the CEO.

The idea is a compelling one. Reitzle widely was considered Ford’s top product man, and some critics believe Ford needs a knowledgeable "car guy" to oversee vehicle development.

But giving the PAG head a bigger role under duress would have smacked of panic. The situation is reminiscent of one at GM nearly a decade ago, when then-CEO Jack Smith offered purchasing chief J. Ignatio Lopez the presidency of GM North America – primarily to prevent him from defecting. Lopez was disliked by many inside GM, and anointing him with the top job may have led to widespread morale problems – if Lopez hadn’t decided to bolt for Volkswagen anyway, leaving a completely surprised Smith holding the bag.

Bill Ford proved he wasn’t about to be taken hostage by one executive. It’s questionable whether Reitzle, who has no experience engineering high-volume cars and trucks, would have been the right man for the job anyway.

Putting him at the top of an organization chart created just six months ago when Bill Ford assumed the mantle of CEO might have had insiders questioning who really is calling the shots at the No.2 auto maker.

And that’s a liability Ford’s newest CEO just couldn’t afford.