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Trotman Has Better Idea for Ford : Cars: Auto maker's new chairman is expected to push to combine European and U.S. operations into a single unit.

March 29, 1994|From Reuters

DETROIT — Ford Motor Co. Chairman Alex Trotman may soon promote a new generation of managers who will try to combine Ford's massive U.S. and European automotive operations into a single global unit, analysts said Monday.

Trotman, Ford's first foreign-born chairman, aims to leave his mark on the auto maker by breaking down barriers between the operations. But the task may take years to accomplish.

The British native has often talked of "draining the Atlantic" with satellite links and common engineering systems, and has vowed to eliminate duplication of efforts.

It is unclear what form such a combination would take, but analysts say it would likely mean a shake-up of management and elimination of some administrative jobs.

"There's bound to be some consolidation when this is announced over the next couple of months," said one source close to the company. Ford had 166,943 U.S. employees in 1993 and 99,527 in Europe.

Reorganization plans may be announced internally in April, when Trotman plans to discuss Ford's global strategy with the company's top 400 managers at a meeting in Toronto. Ford spokeswoman Judith Muhlberg said the meeting is held every four years, but she declined to discuss its agenda.

Ford has already taken globalization steps, and this week will introduce its Ford Contour sedan, a product of its $6-billion "world car" program that developed a single mid-size car platform for both Europe and North America.

But analysts say intense rivalries between Ford's engineering centers in Dearborn, Mich.; Dunton, England, and Cologne, Germany, inflated the car's cost and stretched out its development time to six years--twice the current industry benchmark.

Trotman vigorously defends Ford's investment in the project, but analysts said that, at the very least, he must slash costs of future "world car" programs.

"He gets the chance to prove that

everything he is doing today works when they're going through the next downturn" in 1997 or 1998, said Lehman Bros. analyst Joseph Phillippi.

Analysts said it is also time for Trotman, who became chairman nearly five months ago, to announce a new management team to carry out his plans.

He is still operating under a structure set up by his predecessor, Harold Poling, and has not yet named a new chief for Ford's global automotive units, known as the Ford Automotive Group.

"His grace period is up," said Eugene Jennings, professor emeritus of management at Michigan State University. "It is time that Trotman move the right people into the right places to achieve, among other things, a globalization of his resources."

Jennings, who advises corporate chief executives, said Trotman will likely turn to younger managers with international experience to break down internal "fiefdoms."

"There's no way Ford can go global without a major management shake-up," Jennings said.

Analysts said Ford's vice chairmen, Allan Gilmour and Louis Ross, who vied with Trotman for the top job last year, may be asked to retire soon to make way for the new team. Ross is chief technical officer, while Gilmour heads finance functions.

Top candidates to head the Ford Automotive Group include:

* Ed Hagenlocker, 54, the executive vice president of North American Automotive Operations who spearheaded Ford's aggressive expansion in the U.S. truck market.

* Jacques Nasser, 46, who has led a major cost-cutting drive as chairman of Ford of Europe.

* W. Wayne Booker, 59, executive vice president of international automotive operations, who has strengthened ties with Mazda Motor Corp.

Other candidates for promotion are James Donaldson, 51, vice president and general manager of Truck Operations; Kenneth Kohrs, 55, vice president of North American Car Product Development; and Oscar Marx, 55, vice president of worldwide automotive components operations.

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