Ford Shuffles Management

Ford Motor Co. revamped its top management on Thursday, naming a new chief operating officer it credits with turning around results in the automaker's biggest market.

The shakeup and naming of Jim Padilla to replace Nick Scheele as COO came one day after Ford said its first-quarter profit more than doubled due to cost cuts and a surprisingly strong gain in its automotive business.

The results beat those of crosstown rival General Motors Corp. for the first time in three years. And Chief Executive Bill Ford Jr. clearly gives Detroit native Padilla, who also assumes a new title as chairman of automotive operations, most of the credit for the change of fortune.

Until Thursday, Padilla was an executive vice president in charge of Ford's operations across the Americas.

"Jim Padilla is all about results," Bill Ford said in a statement. "That shows in what he's accomplished in the past couple of years. The company has made a swing of nearly $6 billion in profitability in the past two years, and much of that can be attributed to improved quality, greater customer loyalty and reduced costs in North America."

Ford shares were up 90 cents or 6 percent in afternoon trading on the New York Stock Exchange at $15.84. The hard-charging Padilla, 57, has worked his way up from the factory floor during a 37-year career at Ford.

Scheele, 60, will stay on as president of Ford and remain on its board of directors. But the British-born executive will have a more diminished role. After overseeing the wrenching restructuring program Ford launched in 2002, he will be responsible for global product creation and information technology.

"On the surface of it the change looks like a demotion for him," analyst David Healy of Burnham Securities, said of Scheele. "My guess is that he's phasing out and eventually wants to retire."

In a conference call with reporters, Bill Ford said the change was something he and Scheele had been discussing for months. But the family scion went out of his way to heap praise on Padilla, saying his performance in "the toughest job" at Ford over the last two years was "really first class."

Veteran auto industry analyst Maryann Keller said Thursday's move came against the backdrop of long-standing tension and rivalries in the executive ranks at Ford and said things would hopefully settle down now.

Bill Ford himself, who ousted former CEO Jacques Nasser as the company entered its financial tailspin in October 2001, has said there is more palace intrigue at Ford than there ever was in czarist Russia.

"I think it's a great thing for Ford," Keller told Reuters. "They've rewarded the person who has done the most toward resolving the many problems that Jacques Nasser left behind, and that is without a doubt Jim Padilla."

Ford also announced that David Thursfield, 58-year-old president of international operations and global purchasing, was retiring effective May 1.

Padilla, Scheele and Thursfield have been fast-rising stars at the second-largest U.S. automaker in recent years. But Padilla, who has a solid background in manufacturing and engineering, was alone in having extensive North American experience.

Ford posted its first full-year profit since 2000 last year. And first-quarter net earnings rose to $1.95 billion, or 94 cents a share, from $896 million, or 45 cents a share, a year earlier.

Ford's North American auto business saw pretax profit jump to $1.97 billion, up by $722 million from the year-ago quarter. But Ford Europe, run by Thursfield, posted a pretax profit of just $5 million.

In Thursday's reshuffle, Ford also named Mark Fields as executive vice president, Ford of Europe and said he would continue to head the luxury vehicle brands known as the Premier Automotive Group. Lewis Booth will become chairman and chief executive officer of Ford of Europe, reporting to Fields.

Ford also named Greg Smith, the current head of its finance arm, executive vice president and president of the Americas.