• The Detroit News, Wednesday, April 23, 2008 10:30 AM

A growing sense of optimism, tempered by a fear of external events beyond its control, pervades the top of Ford's Glass House in Dearborn, Mich. In the year and a half since CEO Alan Mulally took the helm, he has downsized its North American operations, negotiated a game-changing contract with the United Auto Workers, sold off Jaguar and Land Rover and has mortgaged much of what is left to secure "the largest home loan in history" to pay for it all.

Mulally also has assembled a global leadership team and is leading a cultural transformation that is shattering the old ways of doing business at Ford. "The biggest challenge is changing the culture," says veteran analyst John Casesa of the Casesa Shapiro Group LLC. "Alan has made a great effort to hold people accountable and weed out those who aren't great believers in the plan."

At the same time, Ford still has not managed to stem a decline in domestic market share that has been going on for more than a decade, the economy is worsening, demand for new cars and trucks is declining, consumer credit is drying up, oil prices set records each trading day, and the rising price of steel and other raw materials is destroying budgets.

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