Ford benefits from CEO's turn to road less traveled

DEARBORN, Mich. -- On this rainy, cold, miserable Tuesday in December, Alan Mulally sits in his office at Ford Motor's headquarters, beaming.

But he's perfectly chipper, showing off a 1903 Indian head penny sent to him by a Ford dealer's son. For luck.

"Isn't that great?" he says, peeling it out of its protective wrapper. "I'm going to keep that in my pocket."

Compared with the other two domestic automakers, Ford looks like it's already been blessed. The automaker has $18.9 billion in cash and $10.7 billion in untapped credit, which Mulally says has his company positioned to survive the market falloff.

That's in stark contrast to General Motors and Chrysler, which say they need billions by this month to avoid filing for bankruptcy court protection.

Not that Ford isn't hurting: It lost $129 million in the third quarter and says it won't be profitable again until 2010 — at the earliest.

But its cash position puts it in the enviable position of saying it doesn't plan to tap government loans that may be offered. That's not unless things get markedly worse for the overall economy, or if one of its Detroit competitors goes under, disrupting the entire supply system.

Is it luck or good planning that got Ford here?

Jeffrey Sonnenfeld, an associate dean at the Yale School of Management, says Mulally's ability to move quickly and not let ego get in the way have helped the company achieve much more than many expected.

"He has surprised an awful lot of people," Sonnenfeld says. "He's had the courage to say he's largely accelerating a given plan, and he's fortified the top lieutenants around him. He's done a great job working with people who know what he doesn't know about the industry."

Mulally has said his strategy since he left running Boeing to take over Ford two years ago was to speed up the three-step line of attack the company had in place: cut production to match demand; make cars people want; and focus on core brands.

It's not complicated, but it has meant breaking with old Detroit ways of doing things, selling brands people admired and laying off tens of thousands.