Ford picks new leader for North America unit after ousting his predecessor

Ford Motor Co. promoted its marketing chief and head of Lincoln to lead North American operations, a day after the automaker ousted a top executive for “inappropriate behavior.” It was the third major management shakeup at the company in about eight months.

Kumar Galhotra, 52, is taking over the carmaker’s most important business unit after the company investigated his predecessor, Raj Nair, and found that Nair had engaged in behavior “inconsistent with the company’s code of conduct.”

Galhotra was promoted to chief marketing officer four months ago when Chief Executive Jim Hackett made a second round of management changes since taking over the top job in May. Nair’s departure — over transgressions Ford has declined to detail — created a significant void. The company acted quickly to fill the spot as it struggles to pad profits and faces questions about the CEO’s turnaround plans.

“Everybody is anxious about where Ford is going,” said Michelle Krebs, an analyst for researcher Autotrader. “This just adds to the disruption.”

Ford shares edged up 0.3% to 10.63 on Tuesday. The stock has declined nearly 15% this year.

Hackett’s challenges

Moody’s Investors Service changed its rating outlook on Ford to negative from stable last month, citing an “erosion” in operating discipline, and said Hackett faces challenges with the “fitness redesign” he has announced to revive the automaker. The company has predicted profit will fall this year as it embarks on a $14-billion cost-cutting endeavor, spends on electric and self-driving cars and reorients the lineup around sport utility vehicles.

Ford named Joy Falotico, one of the few women in its senior executive ranks, the new group vice president of Lincoln and head of the automaker’s overall marketing efforts, effective March 1. Falotico and Marcy Klevorn, head of Ford’s mobility unit, are the automaker’s top female executives.

Falotico, 50, has been CEO of Ford Motor Credit, the automaker’s lending unit, since October 2016. Last year, Ford Credit earned pretax profit of $2.3 billion, up $431 million over 2016. Falotico remains chairwoman of Ford Credit, but her CEO role is being filled by David McClelland, 48, who had been running the company’s marketing operations in Asia.

UPDATES:

3:20 p.m.: This article was updated with Ford shares’ closing price.

This article was originally published at 9:55 a.m.