Ford plans $14B in cost cuts as part of new CEO's strategy

Published: Tuesday, October 03, 2017 @ 12:16 PM
Updated: Tuesday, October 03, 2017 @ 12:14 PM

Ford Motor Co.'s new CEO plans to cut $14 billion in costs, drop some car models and focus the company's resources on trucks, SUVs and electric vehicles as part of a renewed effort to win over skeptical investors.

Jim Hackett, who became Ford's CEO in May, met with around 100 investors in New York Tuesday to lay out his plans for the future. He said getting the company lean and flexible will help it handle the changes the auto industry is facing, from car-sharing to self-driving vehicles, to the shift to electric cars.

"I feel a real sense of urgency for what we're doing here," Hackett said.

Hackett and his executive team spent the summer reevaluating Ford's operations after former CEO Mark Fields was ousted in May. Hackett traveled to Russia and Turkey and visited North American plants and Ford's Silicon Valley research center as part of his review.

He said he was impressed by the talent at Ford, but wants to update factories and speed product development and decision-making. One of his first moves was to pare down the number of people reporting to him. Hackett has eight direct reports, compared to 18 for Fields.

Ford told investors it expects to reduce material costs by $10 billion by 2022 through new deals with suppliers and simpler designs. The company plans to share more parts between vehicles and reduce the options available for configuring a car. For example, customers can now order a Ford Fusion sedan in 35,000 possible combinations. Ford is reducing that to 96.

Ford also says it will cut $4 billion in engineering costs through 2022 by making fewer prototypes and reducing product-development time.

It plans to cut one-third of its engine development costs and redeploy them to electric and hybrid vehicles. Ford plans to introduce 13 new electrics and hybrids over the next five years, including a small electric SUV coming in 2020.

The company plans to reallocate $7 billion from cars to SUVs and trucks. Global demand for those vehicles is rising, and they are critical to Ford's bottom line. Jim Farley, head of Ford's global markets, said Ford plans more off-road SUVs like the upcoming Bronco for North America and more low-end small SUVs and seven-passenger SUVs for China.

The automaker plans to cut some cars from its lineup, but didn't name them Tuesday. Farley said Ford will still offer small cars, like the Focus, but will stick to more expensive — and more profitable — versions.

Ford emphasized that it's open to new partnerships, such as its recent agreement with Indian automaker Mahindra Group to cooperate on mobility, electric cars and other projects. It is also working with ride-hailing company Lyft on self-driving technology and with China's Zotye Automobile Co. about an electric car partnership.

The company says its vehicles will get smarter, with 90 percent of its global vehicles getting modem connectivity by 2020. That will allow things like software updates or apps that help drivers find parking. Ford can differentiate itself by offering, say, connected commercial vans that help small businesses keep track of their deliveries.

Marcy Klevorn, Ford's head of mobility, said Ford launched a medical van service eight weeks ago that can pick up wheelchair-bound patients and take them to the doctor. The service uses Ford-developed software for scheduling appointments, and it will help the company figure out ways that consumers will eventually use self-driving vehicles.

"We have created a box of assets that we can pull out and use for various things," Klevorn said.

Ford stuck to its previous guidance for 2017 on Tuesday. The company expects adjusted earnings of $1.65 to $1.85 for the full year. Ford earned $1.76 per share 2016.

Hackett, the former CEO of office furniture company Steelcase Inc., joined Ford's board in 2013. He briefly led Ford's mobility unit before being tapped as CEO.

Ford hired Hackett, in part, to turn around its share price, which has languished for the last two years even as rival General Motors Co. saw its shares rise to their highest level in seven years. Ford sunk below Tesla Inc. in market value earlier this year, even though it earned $4.6 billion in 2016 and Tesla has never made a full-year profit.

Ford's shares rose 2 percent to close at $12.34 Tuesday before Hackett's presentation. It's not yet clear if his pitch will improve investors' confidence.

"Straddling the now and the future will be tricky, especially in terms of profitability," said Michelle Krebs, an executive analyst for the car-buying site Autotrader.com.

Investors have been critical of Ford for waiting too long to bring a long-range electric vehicle to market, as GM did with the Chevrolet Bolt. They also struggled to understand Ford's plans to compete on autonomous cars.

"In the past few years, Ford simply hasn't had a compelling narrative that investors could latch onto," Barclay's analyst Brian Johnson wrote in a recent note to investors.

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Dog recovers after attack by hawk in backyard

Published: Friday, April 27, 2018 @ 3:17 AM

Daisy is recovering after being attacked by a hawk earlier this week.
Boston25News.com
Daisy is recovering after being attacked by a hawk earlier this week.(Boston25News.com)

A dog in Massachusetts is on the mend after she was attacked in her backyard by a hawk.

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It's been a few days for Daisy and her owner Susan Nascimeno after the 10-year-old bichon frise was attacked by a hawk Monday afternoon while fenced in her East Freeport backyard. 

"She was just covered in blood -- her chest, back, butt, everything was covered in blood; couldn't even see where she was bleeding from," Nascimento said.

Nascimeno said her neighborhood has had problems with hawks over the past few years.

“(Daisy) had two claw marks on one side. The other side they figured when the hawk picked her up and found out she was too heavy, dropped her and ripped the whole side skin off her," Nascimento said.

Daisy was taken to an animal hospital in Rhode Island for surgery on her puncture wounds and broken leg. 

"Wild animals can do a lot of damage, especially if they're hungry. Small dogs or cats can be injured or killed," said Dr. Russell White with the Ocean State Veterinary Specialists.

White has been caring for Daisy and has advice for all pet owners. 

"It's really important for those smaller animals, especially when they go outside, to make sure they're staying close to the house or in an enclosed area even though though those animals can get in to injure them keeping them away from exposed is a good recommendation," White said. 

White said Daisy is expected to make a full recovery.

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Texas man gets life in prison for beating, stomping girlfriend's baby

Published: Friday, April 27, 2018 @ 2:51 AM

A Texas court sentenced a man to life in prison for the beating death of an 18-month-old child.
Mark Makela/Getty Images
A Texas court sentenced a man to life in prison for the beating death of an 18-month-old child.(Mark Makela/Getty Images)

A Texas man was sentenced to life in prison Wednesday after his conviction for beating and stomping his girlfriend’s baby to death, KDFW reported.

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Joshua Beard and the child’s mother, Alexis Botello, are accused of burying the girl in Parker County.

According to police, in 2014 Beard slammed 18-month old Tylea so hard onto a bed that she bounced off it and hit the ground. He then stomped on her, police said.

According to the arrest warrant affidavit for Botello, Beard put Tylea’s body in a car. They drove from Arlington to a Walmart in Weatherford, where they bought gloves and shovels. The couple then allegedly dug a grave under the bridge, buried the child and covered her with logs and rocks, KDFW reported.

Botello later confessed to police and told them where to find Tylea’s body, KDFW reported. She was wrapped in a blanket and wearing only a diaper, according to the affidavit.

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Missing 15-year-old Kentucky girl found safe in Louisville, police say

Published: Friday, April 27, 2018 @ 2:16 AM

A Kentucky teen was found after she disappeared from her school Wednesday. She later messaged a friend saying she was possibly heading to Ohio and to call the police.
Allison Joyce/Getty Images
A Kentucky teen was found after she disappeared from her school Wednesday. She later messaged a friend saying she was possibly heading to Ohio and to call the police.(Allison Joyce/Getty Images)

A 15-year-old Kentucky girl who left school to leave with an unknown person has been found, WKYT reported Thursday.

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Amber Renae Wagers was found safe in Louisville, the Berea Police Department said in a Facebook post.

Wagers, 15, walked out of Berea Community School around 10 a.m. Wednesday to leave with an unknown person, police said.

Investigators believe she met the person through a social media account. She later messaged a friend saying she was possibly heading to Ohio and to call police, WKYT reported.

There were no details about how the police located Wagers, but the Berea police wrote on Facebook that thanks were due to the Kentucky State Police, Louisville Metro Police and the FBI.

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James Shaw Jr. raises $170,000 for Waffle House shooting victims

Published: Friday, April 27, 2018 @ 1:44 AM

Waffle House Shooting: ‘Hero’ Disarmed Shooter and Tossed Rifle Over Counter

James Shaw Jr., who disarmed a gunman who opened fire at a Waffle House in Tennessee on Sunday, has raised more than $170,000 in a fundraiser to help the victims’ families, CNN reported.

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Shaw, who wrestled a rifle away from the gunman and tossed it over the counter, launched a GoFundMe campaign that easily topped its $15,000 goal. Four people were killed during the early morning attack at the Antioch, Tennessee, restaurant.

Restaurant officials in Antioch has pledged to donate all its proceeds for the next month to the families of the deceased and living victims, CNN reported.

Another GoFundMe campaign started by a New York man has raised more than $180,000 from more than 5,600 donors.

>> Who is James Shaw, the man who disarmed the Waffle House shooter?

Shaw, 29, a graduate of Tennessee State University, said he was at a fraternity house party on Saturday night and decided to go to a Waffle House with some friends, The Tennessean reported. He was sitting with a friend at the counter when a gunman wearing only a green jacket opened fire outside the diner, police said.

Shaw crawled along the ground to a restroom area. As soon as there was a pause in the shooting, Shaw ambushed him.

"I figured if I was gonna die, he was gonna have to work for it," he told reporters.

Shaw suffered a wound on his elbow where a bullet grazed it.

Police arrested alleged shooter Travis Reinking 34 hours later, police said.

Reinking is charged with four counts of criminal homicide and faces four counts of attempted murder and one count of unlawful gun possession in the commission of a violent felony.

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