Ford CEO Says Japan Problems Won't Impact Earnings

by Jeff Gilbert
WWJ AutoBeat Reporter

DETRIOT (WWJ) - Ford CEO Alan Mulally says reports that his companies earnings would be impacted by supply shortages from Japan are not correct.

"Even though we might slowdown, or even stop temporarily, some of the Asia-Pacific operations, it would have no impact on our plans," Mulally told reporters. "That means there's no change in the guidance."

Ford's guidance has been that its earnings would improve going forward. Mulally couldn't elaborate on that because the company is in a quiet period, as it prepares to release second quarter earnings sometime this month or early next month.

At this point, Mulally said that he didn't expect any more North American plant idlings. But, he quickly added the situation was still unfolding. Mulally said Asia-Pacific operations were impacted more because they get more of their parts from Japan.

"Outside of that, we are working so closely with all of our suppliers, because it affects everybody," he said. "So far by working together, we've been able to find alternatives, or use down days that we were going to use before."

Mulally speaking to reporters after receiving the "Auto Executive of The Year" award.

He was also asked about his 26.5 million dollar compensation package, which the UAW has called "morally wrong." Mulally saying that it's an example of how all compensation needs to be linked to the performance of the company.

"This is fantastic," said Mulally. "This is business performance based on great products and a strong business. The fact that the compensation is aligned with this, I think, is very, very good."

The UAW begins contract talks with the domestic automakers this summer. There have been concerns that Ford could be at a disadvantage because it's the only one of the three companies that doesn't have a "no strike" clause in their contract. Mulally says the UAW knows that a healthy Ford is good for workers.

"Remember, this is the first time in a lot of years that we're actually hiring again," he said. "Everybody knows now, if you've got a competitive product line, and you're competitive on every element, then you're going to get a chance to grow the business for the good of everybody."

Follow Jeff Gilbert on Twitter @jefferygilbert.