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RUNNING HEAD: FORD MOTOR COMPANY SURVIVES
Antoinette Johnson Reyte On Publishing Copyright 2009©
History of Ford Motor Company and growth over time Edsel Ford races with Alexander Winton in vehicle he built and gets investors interest to start Henry Ford Company in 1901. The Model A car is built in Detroit in 1903. The number #1 automaker, Ford sells more cars than GM in 1906. The Model T is first designed and becomes hugely popular in 1908. Ford goes global and opens a plant in England in 1911. Ford loses ground and becomes #3 automaker in 1933. Henry Ford II comes on board during the war in 1943. Ford goes public in 1956 under Henry Ford II. Legendary Ford Thunderbird born 1954 followed by the Mustang produced ten years later (Davis, 2003). Global expansion as Ford of Europe is organized in 1967. Ford takes over #2 spot as the 2nd largest automaker. Lee Iacocca becomes President at Ford in 1970. Ford invests in Mazda after Henry Ford II retires. After Edsel Ford II and William Clay Ford Jr. succeed retiring Henry Ford II who joins his dad on the board of directors. Ford decides to acquire Jaguar and start up their own financial services division in 1989. Another joint venture as Ford decides purchases Jaguar (Davis, 2003). The next acquisition involves a joint development of their first mini-van with Nissan. In 1996 the milestone is reached of the building of the 250 millionth vehicle for Ford Motor Co. The year of the SUV as Navigator becomes a hot item for Ford Motor Company in 1997. In 1999 Ford acquires Volvo and its first electric car. Ford Thunderbird released in retro style in 2001. Total reorganization as Nasser resigns and Bill Ford Jr. becomes CEO. The Rouge River Plant totally refabricated to produce all Multi-Ford car lines using uniform parts to save production and manufacturing costs in 2003. 2008 Bill Ford Jr. steps down and Board selects Alan Mulally as new CEO for a new Ford Motor Company built on a Ford united platform (Davis, 2003). The company structure and control system and how they match its strategy. SWOT Analysis.
Strengths • Global Company – Ford is a global company with manufacturing in the North and South America, Germany, England plus joint ventures with Japan and Nissan. The Ford (Family Tradition-CEO 100 Years) has owned and managed a major hand in the company. • Bill Ford Jr. introduces major cost cutting measures at just the right time 2003. New ideas turn out good for the company -Reverse Engineering on Taurus Made in Best in Class • • Voip --Saves money on phone costs. Use of telecomm through Computers Ford remains Innovator in the Industry: • • VideoConferencing to hold meetings across the country in several locations simultaneously saving travel costs and reducing time to market
• Computer Aided Design Engineering Portal allows design engineering to collaborate on CAD designs and to share information, ideas, and prototyping plans F-150 State of the Art Facility with totally wireless assembly • Capitalized on profits enjoyed 2001-2004 by reinvesting in the company It reduced overheads, cut product expenditures and slashed warranty costs. At the same time, it boosted revenues by targeting incentives and increasing the mix of high-profit vehicles, such as sports utility vehicles (SUVs) with four-wheel-drive packages" (Taylor 10).
Struggling with sales due to weak designs. 1st Quarter loss in 2009 of $1.4 billion.
Opportunities • Capitalize on the fact that they are the only auto co. of the big three that did not have to take a buyout and are not facing bankruptcy. Buyers attracted to Ford being best able to provide quality and reliability versus nearly bankrupt GM and Chrysler. • Offer better deals on buying Ford vehicles with incentives
• • • •
Offering fuel efficient vehicles Offering lower priced vehicles Become a pacesetter and innovator in the industry Come up with new designs that beat the competition in style, performance and value
Threats • • Foreign Competition. Toyota, Nissan are still strong and rank among the top vehicles in U.S. Losing Market Share – The designs from 2003-2004 were too bland and the consumer was not impressed with Ford’s lineup.
The company structure and control system and how they match its strategy Ford Motor Company is composed of two major Strategic Business Units (SBU). The Automotive and Financial Services SBU. The Financial Services SBU is Ford Motor Credit that handles all of the credit financing related to purchasing their vehicles. The other SBU, for Automotive covers the design and manufacturing and selling of cars, trucks, and their components or parts. This also includes warranty and the servicing of these vehicles. As recent as 2003 Ford Motor Company reorganized its Automotive SBU into foreign versus domestic holdings. The Americas sector consists of North and South America and their focus is on the distribution of the nameplate Mercury, Ford, and Lincoln. The International sector handles all sales and service outside the Americas (Hammonds, 2009). The idea to try reverse engineering further helped Ford to reduce costs and create an awardwinning vehicle in the Taurus. By examining the end product of its competitors on the same body class, Ford built better parts and was able to build a Best in Class Vehicle in the Taurus. Beating out competitors.
5 Some of the strategies are CAD or computer aided designs to build car components. The use of Voice Over I P or (VOIP) has reduced telecommunications expenses drastically. and a better world” (Ford. Alan Mulally came on board from Boeing to steer the company into a new era. 2009). In 2006 a major decision in leadership was made moving to bring a CEO to lead the company. He has a vision that encompasses a desire to contribute its part to strengthening America’s economy.000 and closed down their brands that were not selling in additions to closing several plants (Hammonds. 2009). The company has an aggressive agenda to reduce costs and have done so strategically since 1997. The first wave of cuts revolved around streamlining production and manufacturing processes. In house the use of an engineering portal to share information. This started to compete more directly with competitors Daimler Chrysler and General Motors. and meetings online in real time have saved time and money for the company. Prior to this decisive move Ford reduced headcount by 30. No longer would there be multiple designs of the same part for each vehicle. "Our vision for the future is simple: We want to build great products. a strong business. designs. Mulally steered clear of the government bailout as they were able to get $25 billion in credit without this domestic aid. Since 2003 there have been many new concessions required to maintain the tenuous stability due to the economic downturn.com. He says. standardizing parts saves millions annually. . As well as shop floor robotics such as a wireless assembly plant. The same part now goes in all of their vehicles. Recommendations for the company Bill Ford is focused and poised to bring Ford Motor Company back from the brink. as well as Toyota and other brands.
Leading officials at Ford Motor Company are now saying Ford will be able to pull through 2009 without assistance from the government (Vaughn. Financial analysis of the company present financial condition At the end of the first quarter 2008 Ford turned a profit.6 In addition the internal culture of the organization has had to make some major changes. This attitude is totally new in a culture that was very competitive internally in the past (Hammonds. This is still seen by industry experts as only half the loss expected according to Vaughn of WDET Talk Radio in Detroit. . 2009). the company had divisions within its ranks. 2009).4 billion. Ford has loss $1. Mullally has led the organization to make a change in color that Ford is “One Ford. one team. Car pitted against the truck departments and different engineers and designers competing within the same teams. No more. For the same period in 2009 however. one plan and one goal”. Prior to Mulally.
stm?cmpid=business. So Far. 2009 from http://www. D. Retrieved April 26. (2009).stm?cmpid=business. M.xml Vaughan. J. Retrieved April 26. A History of the Ford Motor Co. 2009 from http://www. Ford Loses $1. (2009).post-gazette.org/article/ford-loses-14-billion-in-first-quarter/ .xml Hammonds. (2003).4 Billion in First Quarter. Retrieved April 26.com/pg/09116/965408-185. Ford Vision Makes it the Survivor. 2009 from http://wdet.post-gazette.com/pg/09116/965408-185.7 References Davis.
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