Detroit - Ford shareholders should expect "fairly large" changes in the coming year, Executive Chairman Bill Ford Jr. told Reuters, building on the carmaker's moves to discontinue some North American models and boost electric vehicle investment.
Ford has promised to cut costs overall but still faces questions about lagging performance in certain regions and calls for more details on its restructuring. Its shares have barely budged since Chief Executive Jim Hackett took the helm last year.
"It could be regions, it could be functions, it could be areas of emphasis," Bill Ford said in an interview on Tuesday. "We’ve done some big things, and we still have some big things to do."
The carmaker lost $4 billion (R50bn) in South America from 2013 through the first quarter of this year, and its chief of global operations said in January it was "exploring every option you can imagine."
Analysts have also urged an overhaul of European passenger car operations to help Ford reach its 8 percent pre-tax profit margin goal.
Bill Ford said the car company will be able to use cost savings to return cash to shareholders, invest in new technology and businesses and fund restructuring.
"We believe we can take care of all three," he said.
Hackett since January has outlined plans to cut costs by a cumulative $25.5 billion (R316bn) by 2022 and prune Ford's list of North American sedans and compact cars (including Fiesta, Fusion and Mustang), while boosting investments in electric vehicles and its product lineup in China.
The company plans to invest $11 billion (R136bn) in new electric vehicles by 2022 but cut overall capital spending by $5 billion (R62bn) over 2019 to 2022, a nearly 15 percent reduction from the prior plan.
Savings from discontinuing unprofitable passenger car models in North America will help pay for a fresher lineup of models, new electric vehicles and technology-driven ventures, Bill Ford said.
"We are adding lots and lots of new models, to the point where we are going to have in 18 months to two years one of the freshest show-rooms in the industry," he said.
Ford, like rivals, is investing in building more electric vehicles and automated driving systems. It is also investing in a network that can be used as the platform for transportation services.
The company last month indicated it is spending about $160 million (R1.9bn) a quarter on mobility services efforts and autonomous vehicles.
Responding to criticism from environmental groups over a shift in the company's lineup to SUVs, Bill Ford said the new models will be more efficient than those they replace.
"Already some of the SUVs are more efficient than their counterparts on the car side," he said, noting that helps the company reduce greenhouse gas emissions and deal with volatility in oil markets.
For the near term, Ford is highly dependent on profits from sales of large pickup trucks and SUVs in the United States.
Hackett not sharing enough
Some analysts earlier this year expressed frustration with Hackett for not sharing more details of his restructuring plans.
Hackett, a former Steelcase Inc CEO, had a learning curve in a new industry in which decisions involve numerous factors including regulation, currency risks, trade concerns and complex supply chains, Bill Ford said.
"I'm really pleased how quickly that learning curve has flattened out," he said. "Jim can juggle a lot of balls at once without them hitting the ground."Reuters