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Jim Farley And His Love Of Racing Makes Business Experts Nervous

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Earlier this month, we reported that new Ford CEO Jim Farley would not be giving up his racing hobby after moving to the top position at The Blue Oval. He also said that he made this clear before accepting the position, and Bill Ford himself was reportedly “very supportive” of the decision. However, it appears that some business experts don’t feel so receptive toward the potentially dangerous activity.

“I think a CEO who puts his or her hobby ahead of concern for the success of the company doesn’t have CEO-level priorities,” Erik Gordon, a law professor at the University of Michigan’s Ross School of Business, told the Detroit Free Press.  “If a board approves a CEO putting a hobby ahead of the company’s interests, they should not be directors.”

However, Ford has likely protected itself by purchasing what is known as key person insurance, which pays the company if its CEO or other executive passes away. And as it turns out, racing is one of the most popular reasons companies opt for such protection. “The reason they do that is because it’s so dangerous,” said said Tim Radcliff, CEO of boutique insurance company PCI based in Melbourne, Florida. “You’re going at a high rate of speed and there’s racing fuel in the car.”

Radcliff admits that he has seen at least 30 cases where top level executives insured by such policies have been injured or killed while doing everything from racing cars to falling off boats. Regardless, most all top-level executives engage in some sort of dangerous activities, as most people do at least occasionally.

“The probability of them dying from these kinds of activities is relatively small,” said Marick Masters, interim chair of the Department of Finance at Wayne State University, who has studied the risks of executive behavior over the years. “There are all kinds of engagements company executives participate in, from sky diving to scuba diving to horse jumping. But these are much less dangerous than obesity, heart disease, smoking, and drinking.”

Regardless of what some experts think, Ford is clearly confident that Jim Farley and his racing hobby won’t be a problem. And in case it is, there’s always a contingency plan.

We’ll have more on Ford’s newest CEO soon, so be sure and subscribe to Ford Authority for the latest Ford business news and non-stop Ford news coverage.

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Brett's lost track of all the Fords he's owned over the years and how much he's spent modifying them, but his current money pits include an S550 Mustang and 13th gen F-150.

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Comments

  1. jason3fc

    A quote from a prof at UofM School of Business = Investors?

    Reply
  2. Roy Chile’s

    FORD and Lincoln desperately needs new leadership preferably vehicle enthusiast at the top to move the company in the right direction. Someone who can focus on all level of the Automotive and bring only the best Sedans,Coupes, Trucks and SUVs to Market from standard to luxury models for all customers

    Reply
  3. Adithya

    His focus on racing should be a good thing. Engineers like me certainly appreciate more passionate people up top, because it gives us the ability to innovate and make desirable vehicles rather than having to play cost assignment politics to get ideas through.
    Ford needs to listen to all customer bases, and that includes enthusiasts. These are your “Cool People” who buy halo cars. If all you have is boring cars which are uninspiring and just sell volume, you end up becoming Nissan and get sent to the dump.

    Reply
    1. Roy Chile’s

      Nissan/ Infinity is selling something Ford can’t sale right now sedans, So there goes the neighborhood

      Reply
    2. Stalkbroker94

      The enthusiasts aren’t the biggest sales numbers. Normal people who often can’t tell you what engine they have DO.

      Reply
  4. Dennis

    What the professor is missing is that this guy is running a CAR company. The fact that he has an enthusiasm for cars is in my opinion a big plus. We have seen too many CEO’s who seem to view cars as appliances or furniture make a mess of things. In many cases cars are still an emotional purchase. A CEO who is excited about and loves the product that his company manufactures is very positive

    Reply
  5. Mortimer Duke

    How is the board’s assent to Farley’s affinity for Motorsport and Ford’s success mutually exclusive? Erik Gordon vastly overestimates his own importance.

    Reply
  6. Mark L Bedel

    Granted, the racing community is a small one relative to the motoring public at large, but keeping in touch with, and being part of this community I feel is an important one particularly given the increasingly mundane direction transportation seems to be taking. And if the excitement this small community generates can be infused more broadly across lines, so much the better!

    Reply
  7. Albert RODRIGUES

    Great story except it is never mentioned what type of racing is he involved in? I personally don’t see him in Bob Tasca III’s Funny Car.

    Reply
  8. Kenneth Shillts

    I am very glad he is not giving up racing. The passion he has will make him a better CEO. He is always thinking about cars. Nobody is guaranteed a tomorrow. The stress of the job killed a lot of people at least he has a reliving that stress.

    Reply
  9. Dave Mathers

    I disagree with the ‘professor’. CEOs who are only focused on their jobs are not good for their company. And what more appropriate hobby could the head of Ford have than auto racing?

    Reply

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