Ford president and chief operating officer Nick Scheele said in an e-mail to colleagues on Wednesday that suggestions another Ford executive was trying to undermine him are “scurrilous”, Reuters reported.

The news agency said the e-mail came a day after Ford said it had reversed a decision by Scheele to consolidate its advertising budget with WPP Group Plc because the move breached company policies. The reversal of the decision was seen by many industry analysts as signs of a growing rift between Scheele and Ford executive vice president David Thursfield, the head of international operations and global purchasing.

According to Reuters, Thursfield has been seen as a likely successor to the 59-year-old Scheele, and the leaking of the probe into Scheele’s decision sparked concerns of a power struggle at Ford just as the company faces a worsening U.S. economy and its own turnaround bid.

Reuters said that Scheele told executives that suggestions fellow Briton Thursfield were trying to undermine him “are really beneath contempt.”

“I have worked closely with David for many years and I have complete trust in both his integrity and his loyalty,” Scheele said in the e-mail, portions of which were obtained by Reuters.

“I know he would never even contemplate doing anything that might compromise the company. Should you ever hear a rumour that David and I are in competition, I ask that you intervene – quickly and directly and stamp the rumour out.”

Reuters said Scheele also urged executives to stay focused on hitting the company’s financial targets. Ford has set an earnings target for 2003 of 70 cents a share, or about $US1.2 billion, after losing $6.4 billion over the past two years.
Reuters noted that Ford has also said it will cut $500 million in automotive costs as part of a plan to make its automotive operations break even this year.

According to Reuters, the review of Scheele’s decision on WPP Group started after Ford’s purchasing department questioned whether the decision met Ford’s standards for sourcing from a single supplier, such as whether a study of pricing from other agencies was done.

It also probed whether Scheele was influenced by an acquaintance with WPP head Martin Sorrell, and the fact Scheele’s son works for WPP Group in New York. While some stories described the men as close friends, company sources say Scheele and Sorrell were no more than business acquaintances, Reuters said.

According to the news agency, WPP Group, the world’s largest advertising firm, already handles 80% of Ford’s ad business, including its Ford, Lincoln, Mercury, Jaguar and Land Rover brands. Ford said on Tuesday that it would continue to consider shifting the remaining part of its ad business to WPP.