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FORD

ORGANISATION

Ford Motor Company is an American multinational corporation and the world's third
largest automaker based on worldwide vehicle sales. Based in Dearborn, Michigan, a
suburb of Detroit, the automaker was founded by Henry Ford and incorporated in June
16, 1903. Ford now encompasses many global brands, including Lincoln and Mercury of
the US, Jaguar and Land Rover of the UK, and Volvo of Sweden. In 2007, Ford became
the third-ranked automaker in US sales after General Motors and Toyota, falling from the
second-ranked automaker slot for the first time in the previous 56 years. Ford was also
the overall seventh-ranked American-based company in the 2007 Fortune 500 list, based
on global revenues in 2006 of $160.1 billion.[5] In 2007, Ford revenues increased to
$173.9 billion, while producing 6.553 million automobiles and employing about 245,000
employees at around 100 plants and facilities worldwide.

Ford came to India in 1998 with its Ford Escort model, which was later replaced by
locally produced Ford Ikon in 2001. It has since added Fusion, Fiesta, Mondeo and
Endeavour to its product line. They have so far covered 24 states in the country. In
Mumbai , they have 7 dealers,Bhavna Ford at Nerul being one. Presently they offer 4
vehicles in Bhavna Ford-Ikon,Fiesta,Fusion,Endeavour with the Mondeo being awaited
to be relaunched.

This project primarily focuses on the product positioning strategy as implemented by

Ford India as well as Bhavna Ford. At the same time, the aspects of the dealer like
awareness factor has also been studied with a Market Research, conducted by us,students
of 1st Year MMS.

PRODUCTS CHARACTERISTICS

Ford India has categorized its vehicles in 2 segments mainly-passenger vehicles and
sports utility vehicle. In the passenger category are-

1. Fiesta
2. Ikon
3. Fusion

The sports utility vehicle, SUV segment has one vehicle to offer as of now in India-
Endeavour. Bhavna Ford as well deals in these 4 vehicles presently. In SAMBHAV ’08,
they displayed Ikon and Fiesta. Now let us have a detailed look at the characteristic
features, added advantage and overall specification data of these all vehicles in a
sequential manner.

FIESTA

The Ford Fiesta is a mid-class supermini car designed and built by the Ford Motor
Company in Europe It is one of Ford's most successful cars with over ten million sold in
seven distinct generations since 1976 and production continues as of 2007, with an eighth
generation expected during 2008. Fiesta comes in five models. They are

Fiesta 1.4 Duratec EXI, Fiesta 1.6 Duratec ZXI, Fiesta 1.6 Duratec SXI, Fiesta 1.4
Duratorq EXI, Fiesta 1.4 Duratorq ZXI

The characteristic features of this presently most popular car of ford are-

SAFETY

Probably this is the second most appealing factor for Ford Fiesta apart from fuel
efficiency. Fiesta is put through the most stringent Ford safety standards that check s for
front & rear crashes and fuel system integrity.

• ABS (Anti-Lock Brake System) with EBD-EBD determines the load condition on
the front and rear axles
• Dog Test-Low-speed frontal impact with obstacles is a common feature in India
• Distance to Empty (DTE)-The DTE displays the estimated distance the vehicle
can travel before it runs out of fuel
• Air Bag-The driver is protected by Driver side air bag

TECHNOLOGY

• Dura Technology-Dura Technology is a world-class revolutionary petrol and

diesel engine technology patented by Ford. It makes the Fiesta more refined, more
exciting to drive and more economical to run or DuraSmooth, DuraVrooom and
DuraSave as we prefer calling it.

• Power Control Module (PCM)-A newly designed PCM is standard in Fiesta for
improved refinement, lower fuel consumption and reduced emissions

• General Electronic Module (GEM) Imagine Generic Electronic Module as a

super computer that controls engine diagnostics

ENGINE
Engine specifications for Fiesta models are given below.

Feature Fiesta 1.4 Fiesta 1.6 Fiesta 1.6 Fiesta 1.4 Fiesta 1.4
Duratec EXI Duratec ZXI Duratec SXI Duratorq EXI Duratorq ZXI
Cyllinder head Aluminium Aluminium Aluminium Aluminium Aluminium
& Block Alloy Alloy Alloy Alloy Alloy
Type 4 Cyl. In-Line, 4 Cyl. In-Line, 4 Cyl. In-Line, 4 Cyl. In-Line, 4 Cyl. In-Line,
16-V DOHC 16-V DOHC 16-V DOHC 8-V SOHC 8-V SOHC
Fuel system SEFI SEFI SEFI High Pressure High Pressure
Common Rail Common Rail
Displacement 1388 1596 1596 1399 1399
(cc)
Compression 9.75 : 1 9.75 : 1 9.75 : 1 18 : 1 18 : 1
Ratio
Max. power 82 / 6000 101 / 6500 101 / 6500 68 / 4000 68 / 4000
(ps/rpm)
Max. torque 127 / 4000 146 / 3400 146 / 3400 160 / 2000 160 / 2000
(nm/rpm)
Emission Bharat Stage Bharat Stage Bharat Stage Bharat Stage Bharat Stage
III III III III III

Apart from these features mention should be made of the exceptional fuel efficiency of
this car. Registered in The Limca Book of World Records(32km/ltr), fiesta diesel version
gives mileage upto 25km/ltr under standard conditions, while the petrol version too gives
a handsome mileage of 18km/ltr.

IKON

Ford’s Ikon is a part of their cross cultural marketing in India. Their initial offering,
escorts was replaced by Ikon, which is meant and so manufactured in India only. The
USP of this car lies in the fact that it has a pick up which is superior to any car of its mid-
class segment. That may have been the reason for the car being called as the Josh
Machine. So high was the pick up for Indian market that it had to be replaced with the
Ikon Flair,compritively having a lesser pick up. The salient features of this car are as
follows.

SAFETY

Thanks to Ford's highly developed Dynamic Safety Engineering (DSE) program safety
becomes a standard with every Ikon. Some key safety features include side impact
beams, crumple zones, a monocoque body and the latest in occupant restraint
systems.The Ikon complies with Ford's European antitheft protection strategy of using a
multi-faceted approach to vehicle security. This includes the following elements on all
the Ikon series:

• High security lock sets, for doors and boot lid

• Steering column lock
• Spare wheel, mounted inside the boot
• Remote locking fuel filler cap connected to central locking
• Child Locks

TECHNOLOGY

The 1.3L ROCAM engine is derived from the new Ford SOHC engine family that is
efficient, reliable and extremely robust.

ENGINE

The engine specifications of Ikon are as follows.

Engine

Feature Ikon
Engine Displacement 1299
(cc)
Max. Power (ps/rpm) 70 PS/5500
Max. Torque (nm/rpm) 105/2500
Cylinders 4 in-line
Emission level Bharat Stage III
Fuel Injection SEFI

As a young icon, you believe in nothing but the best. Expect nothing less of the young
Ikon either. Its fuel-efficient ROCAM engine delivers pure exhilaration behind the wheel.
Its smooth performance and responsiveness makes driving in the city or cruising down
highways a breeze.

DESIGN

FIESTA

Ford Fiesta's robustly well-proportioned powerful stance is born out of cutting edge Ford
design and gives the car its sporty, purposeful presence.

Front View-The Fiesta front design leaves a bold, strong impression with a high
level of sophistication. The large, functional twin headlamps with integrated
turn signal lamps creates identity and a sense of authority. Fog lamps in the
 lower bumper gives the car a low sports feel and the surrounding chrome ring
emphasizes prestige and individuality.

Side View-Fiesta makes a bold, strong, side view statement that enhance it's
sense of purpose and powerful appearance.

Rear View-The high boot not only adds to the side view stance of the car. Modern
and contemporary tail lamps convey a statement of practicality and safety,
and add a touch of sophistication and elegance.

Interiors-The Fiesta's interiors has black and beige two-tone environment with a
wide choice of premium leather or fabric upholstery. Add to this a bright and
modern instrument cluster and luxurious silver finishes. There are intelligent
spaces everywhere inside the Fiesta - a trinket tray, ashtray, a penholder and
cup holders on door boards and rear seat armrests.

Created with the disciplines of Ford's shared technology approach, a core team of Indian
engineers worked with product development teams from UK, Germany and Australia on
the project. 2/3 of the Fiesta has actually been designed specifically to suit Indian
consumers.

EXTERIOR

Feature Fiesta 1.4 Fiesta 1.6 Fiesta 1.6 Fiesta 1.4 Fiesta 1.4
Duratec EXI Duratec ZXI Duratec SXI Duratorq EXI Duratorq ZXI
Twin jewel effect Black Chrome Chrome Black Chrome
headlamps Surround Surround Surround Surround Surround
Integrated turn S S S S S
signal lamps in
headlamps
Chrome bezel on - - S - -
Fog lamps
Radiator Grille Body Chrome Chrome Body Colored Chrome
Surround Colored
Driver and Black Body Body Colored Black Body Colored
passenger mirrors Colored
Grip type door Black Body Body Colored Black Body Colored
handles Colored
Body Side - Body Body Colour - Body Colored
protection Moulding Colored with Chrome
insert
Dual reversing S S S S S
lamps
Decklid Handle Black Body Chrome Black Body Colored
Colored
Turn indicator on - - S - -
outside rear view
mirror

IKON

Chassis Design-The Ikon's stiff body structure plays a key role in isolating ride
comfort and running refinement. The rigid supporting platform helps in
keeping noise, vibration and harshness to minimal levels. Stability and
instinctive controllability have been built into the chassis system to provide
maximum vehicle control.

Ikon Handling-An optimised suspension design, a balanced chassis and sharp

steering precision, make the Ikon a fun machine to drive. Thanks to its
superior handling you can enjoy the ultimate drive experience peacefully.

Ikon Comfort & Convenience-The Ikon's compact exterior is, in fact, wrapped
around a highly comfortable interior. Plush seats, ample headroom, a wide
choice of stowage locations and an eye for convenience transform the
interiors into a highly desirable place to be in.

The Josh Machine has been optimized to match local driving conditions, with a strong
emphasis on durability and minimal requirements for maintenance.

EEC V Module-The latest generation of Ford's electronic module known as EEC V

controls the three engines that power the Ikon. The electronic module has been
fitted on Ford's European engines and has been tested extensively on Formula
1 Grand Prix racing cars. This advanced engine technology helps in fuel
economy, smooth engine operation, low emission & quick fault diagnosis.

PRICING STRATEGY

Of all the elements in the marketing mix, price is the only one that generates revenue.
The other elements generate only cost. It also is the most important determinant of the
profitability of any company or business. Competition in the market contributes the
maximum to the importance of pricing. It is a highly risky decision area, wherein any
mistake in pricing adversely affects the company, its profit, growth and future.

Ford india also has implemented their own pricing strategy which is more of the
Demand/market-based pricing oriented. This we will discuss in details, but before that let
us have a look at the prices being offered by the competitors in Mumbai/Navi Mumbai.

FIESTA HONDA HYUNDAI MARUTI HYUNDAI CHEVROLET

CITY VERNA SX4 ACCENT OPTRA SRV
BASIC 596500 682,800 656891 665200 558047 640000
MODEL
TOP 812500 867,800 867750 771200 - 999840
MODEL

Initially when Fiesta was launched in 2005, it was highly priced at Rs.6 Lacs. At that
time, the competitive brand were Accent and Esteem, which were priced much lower.
However, the present scenario is totally different.

From the above table, a comparison of the price of Fiesta with its nearest competitors
show that it is priced much lower now, in both basic versions as well as top end models.
Since 2005, various competitors have entered the C segment and the prices has also gone
up with changing time. However Fiesta has instead brought down its price, after
skimming the market with high price and eventually high profit. This is a typical example
of skimming pricing strategy.

If we elaborate further, it’s a rapid penetration strategy, since the promotion was
comparatively high and much hyped.

In the list are featuring SX4 which doesn’t have the petrol version. Also Accent has now
only model Gle.

POSITIONING

A product’s position is the complex set of perceptions, impressions and feelings that
consumers hav for the product compared with competitive brands. Positioning involves
implanting the brand’s unique benefits and differentiation in customer’s minds.

Ford India initially had entered the market with Escorts, in 1995 and was one of
the first international brand to enter the midsize sedan market. Ford
Ikon was launched in the event of phasing out of Escort. Since then
Ikon has been a major player in the entry level sedan market with a
share of over 20%. The most interesting aspect of the brand is in its
positioning. Ikon dethroned the position of Esteem in the C segment
through its breakaway positioning. Till 2005 Ikon has sold over 100,000
cars and has occupied a special space in the highly competitive car
market in India. Ford Ikon is actually an Indian adaptation of the highly
successful European Fiesta model. But knowing the Indian market with
the Escort example, the company decided to design and Indian car for
Indian consumers. Thus born the brand Ikon. The company virtually
adapted the whole product to suit the Indian consumer taste and also
Indian driving conditions.Ikon was one of the first examples of Global
brand getting Local in the automotive industry.

Ikon was priced as an entry level sedan car and was positioned in the C
segment. C segment was dominated by Esteem and there was a slew
of competitors waiting to tap the market including Hyundai Accent.
Most of the purchases in this segment was rational and the brands
were also positioned on rational platforms. Ikon wanted to break the
icons and decided to do away with the demographic positioning.
Research and initial test marketing showed that Ikon is associated with
the Attractive and Peppy attributes. The company decided to position
the brand as a lifestyle brand. The TG was decided to be young
professionals who works hard and play hard who are Full of Life and
Affluent. This brand is the classic case of lifestyle segmentation.

Ikon had the sporty design and all the pep that a sporty car needs
interms of engine capacity and performance. The agency hit upon the
big idea of positioning the brand as the Josh Machine.I think the tagline
JOSH Machine is one of the best taglines I have come across. Although
the term Josh is hindi Josh term had a universal appeal across India.
Although some of the ads were lousy, the product delivered the
promise. The Brand clearly identified the TG and Josh satisfied the
need for a sporty sedan ( that need is still there). Indian Yuppies
lapped up this product and the brand which suffered most because of
Ikon was the Maruti Esteem.Ikon was priced between Rs 5.5 lakh and 6
lakhs.The brand broke from the rational positioning into a more
emotional plane.The brand had the famous tagline " The Josh Machine
" which was later modified to " Live Life with Josh". The brand hit a
rough patch in 2003 with competition hotting up. The launch of Indigo
changed the dynamics of the C segment. To compete with Indigo, Ikon
launched a variant in the sub 5 lakh category with Ford Flair.

However, since the launch of Fiesta, the Ikon has lost its way a bit and
that is why the company has come up with newer variants like the
Icool Music edition to position again with the same youth class.

In 2006 Ford launched its Fiesta in the Indian market at a premium

over Ikon. According to company reports, Fiesta is positioned as an
Aspirational sedan and complements Ikon rather than cannibalise it.
Fiesta became a runaway success because of its blockbuster
performance. The entire market witnessed a large number of product launches
and the competition was carving in to Ford's market. Hyundai with its aggressive
marketing was able to beat Ford with their Accent .so Ford decided to fight back
with Fiesta. As usual Ford is also relying on the bollywood stars to sell its car an
this time roped in Abhishek Bachchan to endorse the car.

However Go Fida was a strange caption, so it will be for the entire south indian
market. Josh although it is an Hindi word, south indian languages also have
similar words. Marketers should be careful about the positioning statements and
its linkages with the market. It is important that they understand a diverse maket
like India with 17 odd major languages and million dialects. So does it make
sense to have a positioning statement that is simple and could be understood by
the target market. Still Fiesta is successful because it offers excellent value for
money proposition, the one and only proposition that works in India.

COMPETITION

Ever since its launch, Ikon had to compete with Accent and Esteem. Now both
these cars have been less preferred to their own home brands namely Verna and
SX4. So is the case with Ikon which is no more portrayed with the same Josh
and the company is now focusing on its Fiesta. However, keeping in
mind SX4,Verna and Optra SRV, undoubtedly the biggest competitor of Fiesta
is Honda City which is competent in both petrol and diesel versions. So we will
have a comparative study of both these brands on some basic parameters

Living in

The Fiesta represents a world of cars that India was ready to skip thanks to cars such as
the City. The instrument console, though it harks back to the nineties, is purposeful. That
said, Honda has gone in for no-nonsense instrumentation and ergonomics which make it
easier to drive the car.

There is a certain feel-good factor about belting up in a Fiesta - it feels solid and you are
immediately set for a long drive. If the Honda feels flimsy, it is because it is engineered
to be light - the doors click shut in comparison, while the controls are lighter to the touch
and feel.

Both cars have adequate rear room, with the Honda getting a small advantage thanks to
space liberated under the rear seats. Your legs, once folded, can be accommodated better
in the City.

On the road

The Fiesta diesel is modern enough to fool you into believing that you are driving a petrol
car - even inside the city. What helps matters in favour of the Fiesta TDCi is the fact that
Honda has not given the base City its most powerful engine. The 77 bhp of power and
12.8 kgm torque developed by the 1497cc econo-marvel of a petrol engine ensures that
the 68 bhp 1399cc diesel burner of the Fiesta feels more than adequate.
The Fiesta though has the advantage on the torque front, with the diesel motor developing
16 kgm of the stuff pretty early in life. While just about a second separates both in the
sprint to 60 kph, by the time the speedo reaches 100 kph in the Fiesta (17 seconds), the
City will be a spec on the horizon (13 seconds).

Both cars are capable of cruising at a steady 80-100 kmph on highways and it takes a
downshift in them before you are ready for an overtaking man oeuvre.

Saving fuel

The best figure that we have managed with the Fiesta TDCi is 18 kpl on a Mumbai-Pune
Expressway run - with the car easily averaging 90 kmph plus. The City, with the IDSi
petrol engine, is pretty frugal too and it is not unusual for it to record 16 kmpl on good
highways.

Inside towns, the Fiesta diesel would still return around 14 kmpl, while the City drops to
the 11-12 kmpl mark. That said, our test City recorded 14 kmpl for the suburb-metro-
suburb runs - which is pretty impressive.

Maintenance

The Fiesta apart from its unique fuel efficiency, also counts ahead of City for its low cost
of maintenance. Where the City deserves a servicing after every 5000km, fiesta needs the
same after 10000km.

Dynamic feel

The Honda is a fine automobile that will do extremely well on neatly surfaced roads. But
as the roads deteriorate, most people who wish well for their cars reduce the speed of
their Citys. The Fiesta, on the other hand, offers a more mature ride quality even on
potholed roads.

In short, the average speed that you carry on a bad stretch of road will be higher with the
Fiesta. The finely balanced City can be a tad boring on a nice and winding road while the
Fiesta's underpinnings give you the confidence to push the car around corners - which
makes it quite fun.

Decision time

The odds are turning towards economical cars these days, and in the Fiesta TDCi Exi,
Ford has a very strong case. Even in the 1st quarter 2006 alone, Honda sold more than
10,000 Citys despite heavy competition.

In comparison, Ford managed to do close to 5,000 units. The Fiesta is a contemporary

product that drives extremely well and is quite refined for a diesel offering.
So overall we find undoubtedly the Fiesta to be having the edge against the City.
However, the launch of Verna and SX4 is yet another threat for the market share of
Fiesta. Even the six-year dominance of Honda City, , has been broken by
the SX4. According to figures for May 2007, the SX4 (launched on May
7) sold 3,000 units, against 2,838 units by Honda City, hitherto the
undisputed segment leader.

So the competitive market for for Ford is very much open in terms of
Fiesta, provided it performs well compared to the rival cars.

RECOMMENDATIONS:

The market research conducted by us clearly depicts that as a dealer

for Ford, Bhavna Ford has done really well in its short stint till now.
People are gradually becoming aware of it not only in Navi Mumbai but
also in parts of Mumbai, though scattered. However as students we
wish to recommend some measures to capture a better market share
in the near future. All these measures, if feasible from Ford’s
perspective, and implemented, will certainly benefit them to a great
extent. The recommendations are as follows:

• More number of hoardings can be put up in various unexplored

locations keeping in mind the budget compatibility aspect. The
research shows that hoardings alone comprise of 19% of the
customers’ source of awareness, though it can have a bigger
share.
• Advertisements can be displayed on buses and trains, as some
rivals dealers have successfully exploited.
• Sms ads for test drives can be tried.
• Road shows can be performed in posh areas like Palm Beach
galleria in Vashi.
• Radio ads can be aired between 7-11, the peak hour for listeners
across the city.
• As Ford has some not so positive notion among few customers
with respect to maintenance factor, the number of free services
can be increased.
• Free services, freebies, accessories can be offered on purchasal
of new car to attract more people
• Advertisement can be extended to the giant LCD screens in
prominent malls. Many potential customers can be explored from
there.
• More intense advertisement can be done with the medium of
local TV channel. This also is not a much soughted mode as of
now, so possibly can be explored.
We also would like to add once again, all the measures we suggested
here are based on our own personal observations and the
acceptability is totally in the hands of Bhavna Ford and Ford as a
whole.

PLC

A product’s sales potential profitability changes over time. The Product Life Cycle(PLC)
is the course of a product’s sales and profits over its lifetime.

SALES AND PROFITS OVER THE PRODUCT’S LIFE- FIESTA AND IKON IN THE
PLC.