Ford Motor Co. Ticker:(F) president and chief executive Alan Mulally has been named 2010 CEO of the Year by Morningstar Inc.
Mr. Mulally, as the head of the only U.S. automaker not to take taxpayer bailout funds in 2008 and 2009, was recognized by Morningstar for what it described as exemplary corporate stewardship, independent thinking, and for creating lasting shareholder value.
Mr. Mulally took over as Ford’s chief executive in 2006 and has guided the company through one of the most tumultuous periods in the history of the American auto industry, according to Paul Larson, Morningstar equities strategist.
“Ford has prospered under Mulally’s leadership, and we expect the company’s earnings growth to rise over the next few years as the industry absorbs [the] latent demand,” Mr. Larson said.
Morningstar praises Mr. Mulally for helping the automaker secure $23.6 billion in financing in late 2006 and for navigating the company through 2008, when the stock price traded near $1.
Morningstar analyst David Whiston said that as the capital markets gradually got back to normal and auto sales rebounded, Ford started making money again.
A strong new product line — combined with what Mr. Whiston described as the “goodwill from not taking bailout money” — helped Ford gain more than 100 basis points in market share last year.
Ford stock, now trading at more than $17 a share, gained 67% last year.
Mr. Larson said Mr. Mulally’s leadership is recognized through the execution of several major changes at Ford.
Mr. Larson said Ford recognized the need to shift away from less fuel-efficient but higher-profit-margin trucks before many other automakers.
In addition, the Voluntary Employee Beneficiary Association took over health care benefits for Ford’s unionized workers last year in an agreement that puts Ford’s U.S. labor costs nearly on par with its non-U.S. rivals’.
“Alan Mulally has implemented various measures since he took the reins of Ford to position the automaker to compete better,” Mr. Larson said. “We believe the consumer psychology, vehicle pricing dynamics, the growth in the pool of licensed drivers, and the physics of vehicle wear and tear have contributed to millions of units of pent-up demand in the U.S. auto industry since 2007.”
As recipient of the 12th annual award, Mr. Mulally joins the ranks of past recipients including
Charles Schwab and David Pottruck, co-CEOs of
Charles Schwab and Co. Inc. (1999); Jamie Dimon, Bank One Corp. (2002); and Warren E. Buffett, Berkshire Hathaway Inc. (2008).
