Issue: Sep 2006


Ford Names Boeing's Alan Mulally President & CEO; Bill Ford Is Executive Chairman



by John Larkin

Ford Motor Company has elected Alan Mulally as president and chief executive officer. He has also been elected to the Board of Directors.

Bill Ford will continue his duties as executive chairman of the company.

"One of the three strategic priorities that I've focused on this year is company leadership. While I knew that we were fortunate to have outstanding leaders driving our operations around the world, I also determined that our turnaround effort required the additional skills of an executive who has led a major manufacturing enterprise through such challenges before," Bill Ford wrote in an email to Ford employees today.

"That's why I'm very pleased to announce that Alan Mulally, who turned around the Commercial Airplanes division of The Boeing Company, will become our president and CEO, effective immediately. Alan has deep experience in customer satisfaction, manufacturing, supplier relations and labor relations, all of which have applications to the challenges of Ford. He also has the personality and team-building skills that will help guide our Company in the right direction."

Bill Ford, who said he would remain "extremely active" in the business, praised Mulally as "an outstanding leader and a man of great character." He noted that Mulally had applied many of the lessons from Ford's success in developing the Taurus to Boeing's creation of the revolutionary Boeing 777 airliner. That experience, chronicled in the book, "Working Together," by James P. Lewis, tells how the leadership principles Mulally learned from Ford and developed at Boeing may be applied to other businesses.

"Clearly, the challenges Boeing faced in recent years have many parallels to our own," Bill Ford said.

Mulally, 61, has spent 37 years at The Boeing Company, most recently as executive vice president. In addition, he has also been president and chief executive officer of Boeing Commercial Airplanes since 2001. In that position he was responsible for all of the company's commercial airplane programs and related services, which in 2005 generated record orders for new business and sales of more than $22.6 billion. Mulally was named president of Commercial Airplanes in September 1998. The responsibility of chief executive officer for the business unit was added in March 2001.

"I think the opportunity to work with Bill Ford and Ford Motor Company is the only thing that could have attracted me to a job other than Boeing, where I have so many great friends and memories," Mulally said. "I'm looking forward to working closely with Bill in the ongoing turnaround of this great Company. I'm also eager to begin engagement with the leadership team. I believe strongly in teamwork and I fully expect that our efforts will be a productive collaboration."

Mulally noted that many of the challenges he encountered in commercial airplane manufacturing are analogous to the issues at Ford.

"Just as I thought it was appropriate to apply lessons learned from Ford to Boeing, I believe the reverse is true as well," Mulally said. "I also recognize that Ford has a strong foundation upon which we can build. The Company's long tradition of innovation, developing new markets, and creating iconic vehicles that represent customer values is a great advantage that we can leverage for our future."

Bill Ford said he expected Mulally would assist Mark Fields and the Way Forward team as they accelerate their business plan.

"After dealing with the troubles at Boeing in the post-9/11 world, Alan knows what it's like to have your back to the wall -- and fight your way out with a well-conceived plan and great execution," Bill Ford said in his note to employees. "He also knows how to deal with long product cycles, changing fuel prices and difficult decisions in a turnaround."

Prior to his current position, Mulally served as president of Boeing Information, Space & Defense Systems and senior vice president of The Boeing Company. Appointed to that role in February 1997, he was responsible for Boeing's defense, space and government business.

Beginning in 1994, he was senior vice president of Airplane Development for Boeing Commercial Airplanes Group, responsible for all airplane development activities, flight test operations, certification and government technical liaison.

Mulally serves as co-chair of the Washington Competitiveness Council, and sits on the advisory boards of NASA, the University of Washington, the University of Kansas, Massachusetts Institute of Technology and the U.S. Air Force Scientific Advisory Board. He is a member of the United States National Academy of Engineering and a fellow of England's Royal Academy of Engineering.

Mulally holds bachelor's and master's of science degrees in aeronautical and astronautical engineering from the University of Kansas, and earned a master's in management from the Massachusetts Institute of Technology as a 1982 Alfred P. Sloan fellow.

A member of the board since 1988, Bill Ford, 49, was elected chairman in September 1998, and took office on Jan. 1, 1999. He also serves as chairman of the board's Environmental and Public Policy Committee and as a member of the Finance Committee. He was named Chief Executive Officer on Oct. 30, 2001.

Bill Ford, who led the Company to three straight years of profitability through 2005, told employees in his email that he looked forward to an excellent working partnership with Mulally on global strategic issues.

"Let me assure you: I'm not going anywhere," Bill Ford wrote to Ford workers. "As executive chairman, I intend to remain extremely active in the direction of this Company. I'll be here every day and I will not rest until a prosperous future for this Company is secured."

BIOGRAPHY
WILLIAM CLAY FORD, JR.

As Executive Chairman of Ford Motor Company, William Clay Ford, Jr., is leading the company that put the world on wheels into the 21st century.

"Innovation is the compass by which Ford Motor Company sets its direction," he says. "We want to have an even bigger impact in our next 100 years than we did in our first 100."

A member of the board since 1988, Mr. Ford was elected chairman in September 1998, and took office on Jan. 1, 1999. He serves as chairman of the board's Environmental and Public Policy Committee and as a member of the Finance Committee. He also served as chief executive officer and an officer of the company from October 2001 to September 2006.

As CEO, Mr. Ford focused on improving quality, lowering costs and delivering exciting new products to customers. During his time in that position he took the company from a $5.5 billion loss in 2001 to three straight years of profitability.

"To stay on top in an increasingly competitive global marketplace, we are accelerating our efforts," he says. "We're driving innovation to create exciting products with bold new designs that are safer, cleaner and more fuel efficient."

Mr. Ford joined Ford Motor Company in 1979 as a product planning analyst. He subsequently held a variety of positions in manufacturing, sales, marketing, product development and finance. During the breakthrough 1982 Ford - United Auto Workers labor talks, which launched the employee involvement movement that revolutionized the industry, he served on the company's National Bargaining Team.

In 1983 he began a 12-month course of study as an Alfred P. Sloan fellow at the Massachusetts Institute of Technology. He was elected chairman and managing director of Ford Switzerland in 1987, and was elected to Ford Motor Company's Board of Directors on Jan. 14, 1988.

As head of Business Strategy for the Ford Automotive Group in 1990, Mr. Ford led a team that set guidelines and made recommendations for establishing low-volume manufacturing plants in developing countries at a substantial savings in total cost and no loss of quality.

After being appointed general manager of Climate Control Division in 1992, he led a profit turnaround and a major improvement in product quality. He also established the company's first wildlife habitat at a plant location and the first automotive plant in the world to use 25% post-consumer materials in all of its plastic parts. While he was general manager the division won the President's Commission on Environmental Quality Award for replacing a hazardous chemical in a production process with water.

Mr. Ford was elected a company vice president and head of the company's Commercial Truck Vehicle Center in 1994. He left that position in order to assume the chairmanship of the Board of Directors' Finance Committee in 1995, a position he held until becoming chief executive officer. He was named chairman of the board's Environmental and Public Policy Committee in 1997.

A lifelong environmentalist, Mr. Ford is committed to increasing shareholder value by developing products that please customers and benefit society. In 2000, under his leadership, Ford Motor Company published its first corporate citizenship report outlining the economic, environmental and social impact of company products and operations around the world. That year the company also began the restoration of its Ford Rouge Center in metropolitan Detroit.

"The Ford Rouge Center is one of the enduring symbols of the industrial age," he says. "We have transformed the icon of 20th century integrated manufacturing into a model of 21st century lean, flexible and environmentally sensitive manufacturing. We are excited about creating a new role model for industrial facilities everywhere."

Mr. Ford's charitable, volunteer and business efforts are highlighted by his commitment to the city of Detroit. As vice chairman of the Detroit Lions professional football team, Mr. Ford led efforts to build a new, environmentally friendly stadium in Detroit that was the site of Super Bowl XL. Through Detroit Lions Charities, he helped develop the Detroit Police Athletic League youth football program into one of the largest in the country. Mr. Ford is chairman of the Board of Trustees of The Henry Ford, and a member of the Board of Directors of Detroit Renaissance and eBay Inc.

Mr. Ford was born in Detroit in 1957. He is an avid fly fisherman and car enthusiast, enjoys playing hockey and tennis, and is a black belt in the martial art of Tae Kwon Do. He holds a bachelor of arts degree from Princeton University and a master of science degree in management from Massachusetts Institute of Technology (MIT).

BIOGRAPHY
ALAN MULALLY
Title: President and CEO
Joined Ford: September 2006

Alan Mulally is president and chief executive officer of Ford Motor Company. He also is a member of the company's Board of Directors.

Prior to joining Ford in September 2006, Mulally served as executive vice president of The Boeing Company, and president and chief executive officer of Boeing Commercial Airplanes. In that role, he was responsible for all of the company's commercial airplane programs and related services. Mulally also was a member of the Boeing Executive Council and served as Boeing's senior executive in the Pacific Northwest.

Mulally was named Boeing's president of Commercial Airplanes in September 1998. The responsibility of chief executive officer for the business unit was added in March 2001. Previously, Mulally served as president of Boeing Information, Space & Defense Systems and senior vice president of The Boeing Company. Appointed to that role in February 1997, he was responsible for Boeing's defense, space and government business.

Beginning in 1994, Mulally was senior vice president of Airplane Development for Boeing Commercial Airplanes Group, responsible for all airplane development activities, flight test operations, certification and government technical liaison.

Earlier, Mulally served as Boeing's vice president of Engineering, and as vice president and general manager of the 777 program.

Mulally joined Boeing in 1969 and progressed through a number of significant engineering and program-management assignments, including contributions on the 727, 737, 747, 757 and 767 airplanes.

Throughout his career, Mulally has been recognized for his contributions and industry leadership, including being named one of "The Best Leaders of 2005" by BusinessWeek magazine for streamlining Boeing's production system and transforming the company's commercial airplanes product line.

Mulally serves as co-chair of the Washington Competitiveness Council, and sits on the advisory boards of NASA, the University of Washington, the University of Kansas, Massachusetts Institute of Technology and the U.S. Air Force Scientific Advisory Board. He is a member of the United States National Academy of Engineering and a fellow of England's Royal Academy of Engineering.

He is the immediate past president of the American Institute of Aeronautics and Astronautics (AIAA) and current president of its Foundation. In addition, Mulally is the immediate past chairman of the Board of Governors of the Aerospace Industries Association. Mulally holds bachelor's and master's of science degrees in aeronautical and astronautical engineering from the University of Kansas, and earned a master's in management from the Massachusetts Institute of Technology as a 1982 Alfred P. Sloan fellow.

A native of Kansas, Mulally is a private pilot and enjoys tennis, golf and reading.

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