According to Ford CEO Jim Farley, “Fixing quality is my No. 1 priority. It is the most important initiative in the whole company. And it’s going to take several years until we fix quality, nothing else matters.” A big, clear, and bold message, but the action didn’t stop there. After many years of high warranty costs and recalls, Ford named a new Chief Transformation and Quality Officer, Jim Baumbick.
This is a strategic move from Farley and not surprising — especially after the company spent $3.92 billion on warranty costs in 2020 with $127 billion in revenue. This is well over the 2.5% industry average cost as a percentage of sales and is clearly an area of focus for many auto manufacturers.