Automaker execs worldwide will likely be sending a few gossipy emails around on Monday, but what they should be doing is sending honest reminders to all of their teams.
Ford (F) said Monday that it ousted CEO Mark Fields, and will replace the company lifer with former Steelcase (SCS) CEO and turnaround specialist Jim Hackett. Anyone who has casually watched the developments at Ford over the past few months could have seen this one coming a mile away. First, Ford issued a surprising profit warning back in March thanks to slowing auto sales and investments in Field's pet mobility projects. Since then, auto industry sales trends have arguably worsened, which had many wondering if Ford's outlook was truly kitchen sink stuff.
Then in April, Tesla (TSLA) saw its market cap blow past Ford's. That was no doubt a slap in the face to a proud company such as Ford -- after all, it was one of the pioneers of the automobile industry. To top it off, Ford announced a good number of job cuts last week, likely as the board wanted to goose a stock price that been stuck in neutral under Field's leadership. Since Fields took over on July 1, 2014, shares of Ford have plunged 30%. Although Ford's results have been OK during that span, the reality is that other automakers have better sold their stories to Wall Street and have been rewarded accordingly.
Fields' firing (the word is that he is "retiring") deserves to send momentary shock waves throughout the auto industry, because it sheds light on the uncertain outlook for automakers. On paper, Fields deserves credit for trying to position Ford for a future of electric bikes and smart traffic lights (he also deserves credit for delivering the new Ford GT seen above -- Fields received one of the first GTs off the line, along with chairman Bill Ford Jr.). In fact, he wrote about it in great detail here via a vision for the future of cities.
But while Fields plowed money in this future vision, he neglected the present-day business. Ford has missed key opportunities in electric cars and mid-size SUVs. It could also be argued that General Motors (GM) has done a far better job in pivoting to capture the ride-sharing shift via investments in Lyft and the creation of Maven.
Like never before, automakers are being pulled in so many different directions because how people will get around town is completely up in the air. There isn't one definitive answer -- electric cars won't be owned by everyone, but at the same time not everyone wants to use Uber or Lyft to get to work. Good luck to Ford's incoming CEO Hackett; one of his first jobs should be how to craft a message to Wall Street that Ford will focus on its future but ramp up its present, too.
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About that Trump budget: The Trump White House will release a budget on Tuesday that includes $274 billion in cuts over 10 years to means-tested anti-poverty programs, reports Bloomberg. Some of the biggest cuts will come to food stamps. Trump is proposing to slash $193 billion from the Supplemental Nutrition Assistance Program (aka SNAP), commonly known as food stamps, over the next decade. The cuts would amount to a 25% reduction.
It will be interesting to see how dollar stores Dollar Tree (DLTR) and Dollar General (DG) trade on this news. When more than 500,000 people were booted from food stamps in 2016, dollar stores saw a noticeable sales pullback.
Dude: Granted, Commerce Secretary Wilbur Ross is like 110 years old (he's 79 in fact), but he shouldn't be napping while his boss is giving a major speech in front of a global audience. Ross is no stranger to appearing on TV, so he should know full well the cameras are always watching.
Your tax dollars hard at work.
Secretary of Commerce Wilbur Ross taking a nap during President Trump's speech. pic.twitter.com/X8syV6c8BW— Yashar (@yashar) May 21, 2017
Obesity in America is still an issue: Blame McDonald's (MCD) Big Macs. Blame 500-calorie frozen Starbucks (SBUX) drinks. Whatever the case, the U.S. continues to grapple with an obesity issue. The obesity rate for American adults (aged 15 and over) just weighed in at 38.2%, according to new data from Organization for Economic Cooperation and Development. By far, the U.S. is the fattest country in the world.
So many explanations for this, but one is the persistence of food deserts -- this is where people in urban areas don't have access to affordable fresh fruit and vegetables. In turn, they are forced to rely on fast food or other sugary items in supermarkets for their daily caloric intake.
New data reveals...
The U.S. is still obese. pic.twitter.com/ue9nvqW7hY— Brian Sozzi (@BrianSozzi) May 21, 2017
Adidas is dominating: Want a good example why Under Armour (UA) is struggling to make big-time headway into footwear? Look no further than the killer styles being sold right now by Nike (NKE) and Adidas (ADDYY) , which TheStreet points out here.
Now this is product innovation: Have you seen the products below in stores yet? General Mills (GIS) and Tootsie Roll dropping new products that should have been created 10 years ago...
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