Ford Shakes It Up, Tesla’s Struggle Bus, A Case For Younger Execs

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It’s Thursday and we’re burning around the track this week as we talk about the leadership shake up at Ford. We also review Tesla’s earnings call from yesterday, as well as talk about some new data on the effectiveness of people of different ages on exec teams. 

There was a unique lull in the UAW action yesterday

• Meanwhile, Ford announced a management reshuffle yesterday, promoting Kumar Galhotra from combustion vehicle unit chief to chief operating officer.
  • Kumar Galhotra, who once led the Ford Blue unit producing gas and hybrid vehicles, will now oversee the company's global industrial system.
  • Andrew Frick, who managed Ford Blue's sales, distribution, trucks, SUVs, enthusiast vehicles, and operations in Mexico and Canada, will replace Galhotra at the unit.
• Tesla's third-quarter earnings call revealed a more cautious tone due to global economic concerns and high interest rates. CEO Elon Musk also announced the Cybertruck's delivery date, while also reflecting on management changes and the company's growth amidst competitive pressures.
  • Musk disclosed the company's plans to establish a factory in Mexico aimed at producing affordable vehicles. However, the timeline for this project isn't aggressive due to worries about the state of the global economy. Musk mentioned, "In Mexico, we're laying the ground to begin construction, but I think we want to just get a sense of what the global economy is like before we go full tilt." He further commented that if interest rates decrease, they might accelerate the plans for the Mexico plant. 
  • Tesla's Cybertruck, with over 1 million reservations, is set for its inaugural delivery on November 30th at the Austin, Texas Gigafactory, where its pricing will be unveiled. Musk emphasized the production challenges, aiming for a target of a quarter million units annually after 2024.
  • Tesla stock was down 3% 40 minutes into the call
• While ageism has been a recent topic of discussion, some experts believe younger executive leadership is essential for promoting innovation and addressing long-term challenges.
  • Martin Reeves of Boston Consulting Group states older leaders might rely on outdated strategies and prioritize short-term gains, while younger professionals may be open to new, long-term strategies but lack the authority to implement them.
  • The average age of Fortune 500 CEOs is 57.7, with factors like prolonged life expectancy and pandemic-induced challenges pushing back retirements.
  • Research from George Mason University indicates companies with significant age differences between the CEO and other executives tend to be more innovative.
  • Arjun Shekhar, co-founder of Pravah and ComMutiny, argues for younger executive leadership, emphasizing their fresh perspectives, willingness to challenge the status quo, and adaptability in a digital age.

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