For Ford CEO Jacques Nasser, Damage Control Is 'Job One'
                    September 11, 2000

                    By ROBERT L. SIMISON
                    Staff Reporter of THE WALL STREET JOURNAL

                    DEARBORN, Mich. -- Late every afternoon, Ford Motor Co. executives
                    gather to review the efforts of a 500-person team they have marshaled
                    to cope with the Firestone tire crisis. The team now occupies eight
                    conference rooms spread across the 11th and 12th floors of Ford
                    headquarters here.

                    "We're like an amoeba," says one team member.

                                         In addition to the 500 people directly assigned
                                         to the crisis, 4,000 to 5,000 employees
                                         elsewhere are involved, including those at a
                                         hastily expanded 24-hour customer hotline.
                                         Individual groups are working on logistics, data
                    analysis, technical issues, tire procurement, communications, legal and
                    government affairs, and customer and dealer issues.

                    For Ford President and Chief Executive Jacques Nasser, the
                    damage-control effort has become nearly a full-time job that promises
                    to make or break his career. He participates in each daily crisis meeting,
                    even when he's out of town. He arrives armed with information gleaned
                    from outside his usual reporting channels. He has taken to calling
                    dealers, suppliers and even owners of Ford vehicles who have written or
                    e-mailed him. He has called Ford's own customer hotlines and those of
                    Bridgestone/Firestone, posing as a consumer. He goes online to see
                    what people are saying about Ford in Internet chat rooms.

                    Already Mr. Nasser has taken some big steps to hasten the replacement
                    of the 6.5 million recalled Firestone tires, now linked to reports of 88
                    deaths and more than 250 injuries when their treads peeled off on Ford
                    Explorer sport-utility vehicles and other Ford light trucks. He has
                    brought in competitors of Bridgestone/Firestone Inc. to sell replacement
                    tires, bought tire molds for some of them to work with and shut down
                    three Ford plants that make new Explorers and other light trucks, in
                    order to free up more tires for use in the replacement campaign.

                    The measures are putting Ford's recent string of
                    quarterly earnings records in jeopardy. In a
                    quarterly filing with the Securities and Exchange
                    Commission Friday, Ford officially disclosed it has
                    agreed to pay an undetermined portion of the costs
                    of the Bridgestone/Firestone recall. And officials
                    acknowledge that third-quarter earnings will take a
                    hit. Contributing to that will be the decision,
                    announced Friday, to keep three light-truck plants
                    closed for a third week this week to make more
                    15-inch tires available to replace those being

                    Mr. Nasser's aggressive personal role offers a sharp
                    contrast with the more diffident behavior of other CEOs in the midst of
                    corporate crises. For instance, his counterparts at
                    Bridgestone/Firestone and its parent, Japan's Bridgestone Corp., have
                    stayed largely in the background, raising questions in some critics'
                    minds as to whom is in charge. Meanwhile, the company balked at
                    sharing with Ford the data that led to the recall, resisted replacing tires
                    not only in the U.S., but also overseas, and has implied that if only
                    consumers took better care of their tires there wouldn't be a problem.

                    But the 52-year-old Mr. Nasser isn't out of the woods yet. Ford's
                    credibility has been badly hurt by disclosures that the company knew
                    about problems with the Firestone tires on its Explorers before it told
                    U.S. regulators and consumers. Ford officials didn't tell the National
                    Highway Traffic Safety Administration until May about a tire-replacement
                    program last year in the Mideast, where treads were peeling off
                    Firestone tire models that aren't involved in the U.S. recall and causing
                    accidents and deaths. Ford says Bridgestone/Firestone repeatedly failed
                    to find a problem with the tires, so the auto maker replaced them as a
                    customer-satisfaction move. Ford officials say they didn't feel obligated
                    to report the matter to NHTSA because they hadn't found a safety

                                         Ford also appeared slow to act and slow to tell
                                         U.S. authorities about a rash of accidents and
                                         fatalities related to tread-separation incidents in
                                         Venezuela and other Latin American countries.
                                         Last week, congressional investigators released
                    an internal Ford memo describing how Bridgestone/Firestone didn't
                    want to cooperate in replacing the tires overseas because it felt that
                    doing so would obligate it to report the matter to NHTSA. Ford
                    maintains it acted expeditiously and appropriately in each case, including
                    the U.S. recall.

                    At congressional hearings featuring testimony from Mr. Nasser last
                    week, one lawmaker after another accused Ford and
                    Bridgestone/Firestone in front of TV cameras of ignoring signs of a
                    serious safety defect while people were being killed, or of trying to cover
                    up a problem. Rep. Bart Stupak (D., Mich.) blasted both companies for
                    being unaware of the problem and for not taking action sooner after
                    State Farm Insurance Co., plaintiffs' attorneys and even a Houston TV
                    station had noticed a deadly pattern. Declared Rep. Tom Bliley (R., Va.):
                    "Ford ... is not blameless in this matter. ... When faced with hundreds
                    of complaints of major tire defects on the Explorer, [Ford] failed to
                    respond with the sense of urgency that one would expect when the
                    safety of so many people rested on its shoulders."

                    Adding to the uncertainty engulfing Mr. Nasser is that the root cause of
                    the tire separation remains a mystery. It isn't clear whether the fault lies
                    with Firestone's tires, Ford's vehicles, or the two in combination. An
                    analysis of complaints filed with NHTSA indicates a disproportionate
                    number of tread separations and accidents involving Explorers equipped
                    with the recalled tires. Ford officials argue that this doesn't necessarily
                    prove a problem with the Explorer because the problem was with tires
                    Bridgestone/Firestone built specifically for that model. They point to the
                    spotless record compiled by Goodyear Tire & Rubber Co., which built
                    Explorer tires to the same specifications from 1995 through 1997.

                    It all adds up to a Herculean challenge for a man who became Ford's
                    CEO in January 1999, on the strength of his track record as a cost
                    cutter. The son of Lebanese immigrants to Australia, Mr. Nasser as a
                    young man was involved in bicycle and coffee shops. His Australian
                    accent is evident in two TV commercials he taped for Ford recently to
                    reassure the company's vehicle customers.

                    Mr. Nasser joined Ford after taking a business degree from the Royal
                    Melbourne Institute of Technology, and he held several positions in
                    Ford's far-flung Asian operations. Subordinates describe him as
                    fascinated with technical detail and able to ask insightful questions that
                    often push them in new directions. A compact, fit and energetic man
                    who sleeps little more than four hours a night, Mr. Nasser collects
                    expensive watches, fancies well-tailored clothes and drives himself to
                    work in a town where other CEOs typically have a chauffeur.

                    The trouble with Firestone tires first appeared on Mr. Nasser's radar
                    screen early this year when aides showed him tape of a February report
                    by Houston TV station KHOU. It linked tread-separation incidents
                    involving Firestone tires on Explorers with several fatal accidents. Then,
                    in early May, NHTSA opened an inquiry into the matter.

                    Ford built much of its success in the 1990s on a massive expansion of
                    its profitable light-truck operations, which build SUVs, such as the wildly
                    popular Explorer, and pickups such as the ubiquitous F-series. Trucks
                    now account for more than half of Ford's auto production.

                    With one of Ford's crown jewels threatened, Mr. Nasser got personally
                    involved. "I started to feel we needed to accelerate our knowledge of
                    what was going on. We were going to get the best minds on this
                    quickly. This was a full-time job. I wanted a full-time team," Mr. Nasser

                    He commandeered a conference room on the 11th floor of Ford
                    headquarters, ordering "the best communications, best computer
                    systems and ready access to all the top management," he says. A
                    recently completed renovation had equipped the building to handle such

                    Andy Vandecaveye, the 41-year-old chief program engineer for the
                    current Explorer, was one of the first 15 assigned to the project. "I was
                    told my job would be to come over here for 15 hours a day," he recalls.

                    He soon learned that was no exaggeration. As of this morning, he will
                    have worked 40 such days in a row. He laments not being able to keep
                    up with mowing his lawn, and says his wife told him last week that his
                    hair was suddenly starting to show gray at the roots.

                    Mr. Vandecaveye is in charge of a team of 15 Ford tire, rubber and
                    other experts who are supervising the search for the root cause of the
                    tire failures. Mr. Nasser argues that "this is a tire problem," and Ford
                    officials are hoping for a conclusion that proves him right. Mr. Nasser
                    pushed Mr. Vandecaveye to hire outside tire experts to help with the
                    search, and he has given the crisis team carte blanche. "Anybody we call
                    in the company, we say we're on the tire team, and they say, 'What
                    resources can we provide?' " Mr. Vandecaveye says.

                    The root-causes team has gotten used to seeing Mr. Nasser breeze in
                    once or twice a day to "ask how the engineering analysis is going," Mr.
                    Vandecaveye says. "He'll grab a tire and ask a question. He likes details.
                    He wants to know what processes we are using." Mr. Nasser pushed the
                    team to adopt a rigorous, scientific approach to the inquiry and made
                    experts in such methodology available to it.

                    The leaders of the 500-person crisis team gather at a daily meeting with
                    a standing agenda and a structured discussion of each topic. There are
                    usually 20 managers seated around a conference table, with 15 or 20
                    more hovering around the edges and more joining in via conference call.
                    On weekdays, the meeting is held in the late afternoon; on weekends
                    it's around midday. John Rintamaki, a Ford group vice president and the
                    company's chief of staff, acts as chairman.

                    Mr. Nasser has been pushing the team to press harder to help Ford's
                    customers, echoing a broader theme of his tenure as CEO. In January,
                    Mr. Nasser pointedly replaced Ford's old motto -- "Quality is Job One" --
                    with a new one: "Customer Is Job One." Ford managers carry wallet
                    cards that show the new line as the foundation of the company's
                    pyramid of corporate values (with "Superior Shareholder Returns" at the
                    top). And it isn't just a motto: Starting this year, half of executive
                    bonuses are based on gauges of customer satisfaction.

                    Mr. Nasser's calls to the customer hotlines "caught me by surprise,"
                    says Martin Inglis, head of Ford's North American operations. "He
                    pushed us to make all the call centers 24-hour operations," Mr. Inglis
                    says. Ford boosted to 800 the number of employees at its call centers
                    from the normal 300, and opened a new center in Denver "in record
                    time," Mr. Inglis says.

                    Mr. Nasser's personal contacts with customers also had an impact on
                    Bridgestone/Firestone and other tire makers.

                    "Originally," Mr. Nasser says, "Firestone wanted to prioritize shipments
                    of tires to certain states. During this meeting, we said, 'That isn't
                    customer-friendly. That just isn't right.' We decided not to do that.
                    Firestone had limited replacements to one Firestone for another
                    Firestone. And in one of these meetings, we said, 'Look, if we talk to
                    these other [tire] competitors, maybe we can get some added capacity.'
                    " Firestone's initial plan would have left some Explorer owners waiting as
                    long as a year for new tires.

                    Mr. Nasser's talks directly with customers convinced him there was too
                    much fear and frustration for that plan to work. "Many customers would
                    say, 'Look, we've gone to the Firestone tire store and they've told us
                    we have to wait for two months or three months,' " Mr. Nasser says. "
                    'Yet, I can go down to Costco, or Belle Tire, and they've got tires. Why
                    can't we do that?' "

                    Mr. Nasser leaned on Bridgestone/Firestone to reimburse customers or
                    dealers for non-Firestone replacements. Ford dealers joined Firestone
                    stores in installing replacement tires. Ford engineers began testing
                    alternative tires around the clock. So far, they have declared 34 tire
                    models made by Bridgestone/Firestone and other tire makers suitable
                    as replacements. Parent-company Bridgestone agreed to tool up several
                    plants in Japan to make replacement tires and to ship them by air

                    Mr. Nasser also approached the CEOs of Continental AG, Goodyear and
                    Groupe Michelin. "Help our customers by increasing the production of
                    your tires so we can replace the bad tires with good tires," Mr. Nasser
                    says he urged them. In response, Firestone rivals cranked up
                    production of replacement tires. One idea from the daily brainstorming
                    meeting, says Mr. Rintamaki, the chief of staff, was for Ford to buy tire
                    molds for some of the rival manufacturers to use. He says Ford is doing
                    so, but he won't say for which manufacturers.

                    In one of the daily discussions of tire availability, when Mr. Nasser
                    offered his usual prod to do more for customers, Mr. Inglis recalls
                    saying, "I guess we could take them off new vehicles." Mr. Nasser told
                    the team to look into it. "That was a Friday evening," Mr. Inglis says.
                    "Our people looked at it over the weekend, and worked out the logistics,
                    and by the end of the weekend we were ready to go. Then we told Jac."
                    That led to the three-plant shutdown that was extended into a third
                    week this week. Ford said the initial two-week closing freed up 70,000
                    tires for the recall.

                    Taken all together, Ford officials say, these efforts are expected to
                    enable the company to complete the recall earlier, by the end of next
                    year's first quarter. The tire team is still puzzling out how it might be
                    able to line up enough tires to complete the program even sooner,
                    perhaps by year end.

                    Last Thursday, Mr. Nasser got an unusual, semipublic performance
                    review from his boss, Ford Chairman William Clay Ford Jr. "Nobody," Mr.
                    Ford declared in a "town meeting" broadcast live to employees
                    world-wide over Ford's internal TV network, "could have done a better
                    job than Jac Nasser." Mr. Ford then led the more than 400 on hand at a
                    world headquarters auditorium in a standing ovation.

                    Mr. Ford, a great-grandson of company founder Henry Ford, took the
                    occasion to explain his own reticence throughout the crisis. "Some of
                    you have said in recent weeks to me, 'Bill, where have you been? You've
                    been uncharacteristically quiet and behind the scenes.' And, in fact, I
                    have," Mr. Ford said. His explanation: "I think it would have been very
                    confusing for the company to have two spokesmen out at this very
                    critical time."

                    Mr. Nasser's senior management team, meanwhile is said to be keeping
                    Ford's factories running, the product designers on course and the bills
                    paid. Group Vice President Robert Rewey has drawn special praise from
                    Ford insiders for producing a U.S. vehicle-sales record for the company
                    last month in the face of the negative publicity generated by the tire
                    crisis. This week, Ford is understood to be entering the final phase of
                    negotiating the purchase of South Korea's Daewoo Motor Co., largely
                    under the supervision of Vice Chairman Wayne Booker.

                    At the same time, Mr. Nasser faces a big challenge calming the concerns
                    of Ford employees. During an internally broadcast "town meeting" on
                    Sept. 1, Mr. Nasser told employees: "I've received a lot of e-mail from a
                    lot of employees asking questions about how it will affect compensation,
                    how it will affect this and that. They're good questions, but not right
                    now, not right now. I mean, we've got so many things to do that we
                    really should be focusing all of our energy on making sure that we can
                    get as many tires out there as possible."