Ford chairman and CEO Bill Ford is concerned enough about Ford of Europe that he recently directed executive vice president David Thursfield to go to Cologne and oversee day-to-day operations there, a high-ranking Ford executive familiar with the decision told The Detroit News.

The paper said Ford’s European operations, which as recently as last year were touted as its blueprint for success, have emerged as the biggest threat to the firm’s turnaround plan.

The Detroit News said Ford of Europe, based in Cologne, Germany, posted a pre-tax loss of $US774 million in the first six months of 2003 – setting off alarm bells at Ford world headquarters in Dearborn.

The paper said Thursfield ran Ford of Europe until August 2002, when he was brought to Dearborn to run the automaker’s global purchasing and international operations, and still holds the title of chairman of Ford of Europe.

“Bill wants David over there working on this until the problem is fixed,” the executive told the Detroit News this week. “Bill is saying, ‘I will have no more surprises.'”

The paper noted that Ford is a year and a half into a turnaround plan designed to deliver $US7 billion in pretax profits by mid-decade and expects to earn $1.3 billion this year after losing $6.4 billion in 2001 and 2002.

The Detroit News said that, while Ford executives said in early 2001 that the European operations would be a pillar of strength as the it restructured its ailing North American operations, Ford of Europe has instead becoming a “sinkhole” that is swallowing profits earned at other units as North America, Asia-Pacific and South America perform up to expectations this year.

“The turnaround of Ford in Europe is a bit of a myth,” Garel Rhys, director of Cardiff University’s Center for Auto Industry Research in Wales, told the newspaper. “What Thursfield did was stop the decline of Ford of Europe.”

The Detroit News said Ford’s unit sales, revenues and market share are up this year in Europe but the company blames falling net prices, an unfavourable product mix and lower industry sales for wider losses as falling prices and lower industry volumes batter the mass-market brands in Europe.

The paper said that, beginning next week, Thursfield will be spending about three weeks a month in Europe along with Bibiana Boerio, director of finance strategy for Ford’s international operations, and John Walker, head of human resources for Ford’s international operations, who have also been dispatched from Dearborn to help fix Ford’s troubles.

The group will work with Martin Leach, president and chief operating officer of Ford of Europe since August 2001, to cut costs and raise revenues, the Detroit News said.