A year ago, when the heads of Detroit's Big Three - GM's Rick Wagoner, Ford's Alan Mulally, and Chrysler's Bob Nardelli - appeared in the infamous Capitol Hill bailout hearings, many lawmakers, and many Americans, decided that this trio from the industrial heartland could all be tarred with the bad-CEO brush. There was a telling moment, during a discussion about executive compensation, when the three CEOs were asked if they were willing to work for a dollar a year.
Mulally's polite reply, "I think I'm OK where I am," was a juicy piece of red meat for the national media, who were as one in their downright contempt for these three men and the industry they represented. CNN's Anderson Cooper literally sneered in disgust.
The truth of the matter was hard to ascertain in that politically charged Senate hearing room, but it's now obvious: Alan Mulally was, and is, worth whatever Ford is paying him, because he has almost single-handedly saved the automaker. The Ford Motor Company, unlike its two Detroit rivals, has not declared bankruptcy and has not dipped its hand into the TARP trough. (In fact, Mulally took a 30 percent pay cut and declared that he would indeed reduce his salary to $1 per year if Ford took government funds. "I'll do well when Ford does well," he tells us.) Ford stands alone as the sole Big Three automaker that is still an independent entity. For this achievement, and for steering Ford onto a clearly defined road toward success, Alan Mulally is Automobile Magazine's 2010 Man of the Year.
Mulally is living proof that a single, extraordinary leader with vision and determination really can make all the difference in an organization. In 2006, when Bill Ford, Jr., went shopping for someone to take over the role of Ford CEO, he was looking for not just a talented executive but for someone who had demonstrated the ability to reinvent and reimagine an entire corporate culture. Candidates were thin on the ground, but Mr. Ford found his man, the father of the Boeing 777 airliner, in the number-two chair at the aircraft manufacturer. Industry observers were shocked: never had someone with absolutely no car experience been appointed to such a high position.
But Mulally wasted little time proving his worth as he sensed, long before crosstown rivals, that the automotive business was about to get extremely difficult. His first task was to ensure that Ford had enough cash on hand to weather a recessionary storm, so he mortgaged all of Ford's assets, including the blue-oval brand itself, on Wall Street and netted $23.5 billion. "I spoke to a room with over 500 bankers," he recalls. "Why did they give us the money? Because we had a plan." At the time, though, Ford seemed desperate, especially since its product portfolio was in disarray compared with GM's. In fact, Mulally was dismayed to discover that the company's famous nameplate, Taurus, had been thrown on the scrap heap. One of his first and best-known decisions was to resurrect it.