Ford In Bangladesh

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Introduction

The main purpose of the report is to know the strategies that can be used by the

Multinational Companies in order to enter into the capital market of Bangladesh. The main

objective is to find out the reasons behind why Ford come in Bangladesh for their business

propose and what kind of strategies they had taken to enter in Bangladesh. The market analysis is

also a part of the objectives of the study. The govt. Rules and regulation of the industry is also be

part of the objective.

Background

Bangladesh is considered one of the least developed nations and has some of the worst

health and nutrition outcome data. The situation is due, in part, to its climactic and demographic

characteristics that have slowed economic growth. However, rapid population growth and

political antagonism have also contributed to this point.

Economic data reveals that the GDP is increasing steadily, with an average of 4.9% from

1990-1999 and 5.5% in 1999/2000. However, it is possible that some of these statistics

exaggerate economic improvements for the nation as a whole. In 1999, the services sector

contributed 52% of the GDP and employed 25.0% of the population, while the agricultural sector

accounted for 21% of the GDP and employed 57% of the population. In the past, unemployment

has been a huge problem and has been most directly impacted by the population growth rate but

now the Per Capita Income is also increasing day by day. Recent trends show a decline in

population growth rate that has been attributed to a successful family planning program and the

per capita income and Per Capita Income is also increasing.

Some list of multinational companies operating business in Bangladesh

Chevron (Petroleum Industry) Chevron is the largest producer of natural gas in

Bangladesh, supplying approximately 50 percent of the country’s natural gas consumption. It has

increased production tenfold in the last decade to meet the country’s ever-increasing demand for

natural gas.

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Grameenphone Ltd (Concern of Telenor, Telecommunication industry) Grameenphone

is the largest mobile provider in Bangladesh. The largest of six mobile operators in the country.

Grameenphone have 43.968 million mobile subscriptions. It is a joint venture enterprise between

Telenor and Grameen Telecom Corporation, a non-profit sister of the internationally acclaimed

microfinance organization and community development bank Grameen Bank.

Unilever Bangladesh (FMCG) Unilever started its journey in Bangladesh in 1964 with a

soap factory was set up at Chittagong. Unilever Bangladesh’s have more than 10000 people

directly or indirectly related with working framework. Unilever Bangladesh Product categories

are: Household Care, Fabric Cleaning, Skin Cleansing, Skin Care, Oral Care, Hair Care, Personal

Grooming, Tea based Beverages.

Standard Chartered Bank (Banking Industry) Standard Chartered Bank is the largest

international bank in Bangladesh with 26 Branches, 57 ATMs and 7 Financial Kiosks;

employing over 1,300 people. Standard Chartered the only foreign bank in the country with

presence in 6 cities – Dhaka, Chittagong, Khulna, Sylhet, Bogra and Narayanganj; including the

country’s only offshore banking units inside Dhaka Export Processing Zone (DEPZ) at Savar

and Chittagong Export Processing Zone (CEPZ).Standard Chartered has been operating in

Bangladesh for over a hundred years.

HSBC(Banking Industry) In Bangladesh, the HSBC Group’s history dates back to 1996

when The Hongkong and Shanghai Banking Corporation (HSBC) Ltd opened its first branch.

Today, the HSBC Group offers a comprehensive range of financial services in Bangladesh

including commercial banking, consumer banking, payments and cash management, trade

services, treasury, and custody and clearing.

Citi NA (Citi Group, Banking Industry) Citibank N A a foreign private bank in

Bangladesh and Citi has established a strong presence in Bangladesh. It now has four branches,

four service outlets and employs more than 180 people. Citi’s clients in Bangladesh comprise

both public and private sector institutions.

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Siemens (Electronics) Siemens is one of the leading companies in the growing area of

electrical engineering and electronics sector in the world. Siemens is a German electrical giant

company and operating in 190 countries across the world. Siemens is creating leading-edge

innovations for better life, and driving profitability and corporate responsibility around the globe.

Siemens started his journey in Bangladesh in 1956. Siemens have contributed in Bangladesh’s

major modernization and infrastructure development programs. Siemens have successful

concentrated in the power and energy sector of Bangladesh.

British American Tobacco (Cigarette) British American Tobacco Beginning their

journey 100 years back in Bangladesh and they have started their journey properly in

independent Bangladesh in 1972 that time the name of the company was Bangladesh Tobacco

Company Limited. In 1998, the Company changed its name and identity to British American

Tobacco Bangladesh Company Ltd. British American Tobacco Group, the world’s most

international tobacco group with brands sold in more than 180 markets across the world.

Nestle Bangladesh Nestlé with headquarters in Vevey, Switzerland was founded in 1866

by Henri Nestlé. Nestle is today the world’s leading nutrition, health and wellness Company.

Nestlé Bangladesh Limited started its first commercial production in Bangladesh in 1994.Factory

of Nestlé in Bangladesh situated at Sripur.500 people directly working in Nestle and indirectly

more than 1000.

Youngone(Garments Industry)

Youngone Padding (Cepz) Ltd office address:

Plot # 9-11, 18-20, Sector # 07, Chittagong Export Processing Zone

Chittagong, Bangladesh

Phone: +880-31-740466-67, 740184

Pragoti Industries Limited Pragoti Industries Limited is a Bangladeshi car assembling

and car parts manufacturing company headquartered in Chittagong with a manufacturing plant

in Agrabad. Founded in 1966, it is country's largest car assembling plant and it has assembled

and marketed more than 50,000 vehicles such as cars, Jeeps, Buses, Trucks, Pickups,

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Ambulances, Tractors of multiple models by importing CKD (Complete Knocked Down ) kits

from overseas.

Aftab Automobiles Ltd In 1981 the Company was converted into Public Limited

Company which is the lone largest assembler-cum-progressive manufacturer of Toyota & Hino

vehicles in the private sector of the country.The Company is mainly a vehicle assembler and

body fabricator. It has been successfully assembling TOYOTA & HINO vehicles for Bangladesh

market since 1982.

Company Overview

Ford Motor Company (Ford), incorporated on July 9, 1919, operates in the global

automotive industry. Ford operates in two sectors: Automotive and Financial Services. The

Company manufactures or distributes automobiles across six continents. Its automotive brands

include Ford and Lincoln. The Company's Automotive sector includes Ford North America, Ford

South America, Ford Europe, and Ford Asia Pacific Africa regions. During the year ended

December 31, 2012, the Company sold approximately 5,668,000 vehicles at wholesale

worldwide. Other Financial Services includes a range of businesses, including holding

companies and real estate. The Company and its subsidiaries are also engaged in other

businesses, including financing vehicles. Ford provides financial services through Ford Motor

Credit Company. Effective September 26, 2013, Ford Motor Co acquired Livio, a developer of

software.

The Ford Motor Company (also known as simply Ford) is an American multinational automaker

headquartered in Dearborn, Michigan, a suburb of Detroit. It was founded by Henry Ford and

incorporated on June 16, 1903. The company sells automobiles and commercial vehicles under

the Ford brand and luxury cars under the Lincoln brand. In the past it has also produced tractors

and automotive components. Ford owns small stakes in Mazda of Japan and Aston Martin of the

United Kingdom. It is listed on the New York Stock Exchange and is controlled by the Ford

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family, although they have minority ownership. It is described by Forbes as "the most important

industrial company in the history of the United States.

The Company sells vehicles to its dealerships for sale to fleet customers, including

commercial fleet customers, daily rental car companies, and governments. Ford also sells parts

and accessories, primarily to its dealerships (which in turn sells these products to retail

customers) and to authorized parts distributors (which in turn primarily sells these products to

retailers). Through its dealerships, it also offers extended service contracts to retail customers

The Company sells vehicles to its dealerships for sale to fleet customers, including commercial

fleet customers, daily rental car companies, and governments. Ford also sells parts and

accessories, primarily to its dealerships (which in turn sells these products to retail customers)

and to authorized parts distributors (which in turn primarily sells these products to retailers).

Through its dealerships, it also offers extended service contracts to retail customers.

Marque Country of origin Years used/owned Markets

Ford United States 1903 to present Global

Lincoln United States 1922 to present North America, Middle East

Mercury United States 1939 to 2011 North America

Edsel United States 1958 to 1960 North America

Merkur United States 1985 to 1989 North America

Jaguar United Kingdom 1989 to 2008 Global

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How Ford Enter Into Bangladesh

AG Automobiles Ltd. (AG Auto) was incorporated in August 2004 with a view to

rejuvenating the country’s transport sector. AG Auto took up projects to create awareness of

cleaner environment directly amongst the commercial vehicle owners. Long-term soft loan

financing was bundled to vehicle owners to make the switch from diesel to environment friendly

Compressed Natural Gas (CNG)

Commitment and performance led to getting attention from other world-renowned

automobile brands seeking to enter and penetrate the automobile market of Bangladesh.

Consequently, AG Auto received distributorship rights of Global Automobile Icon “Ford Motor

Company”.

Ford, the third largest automaker of the world with production of 6.553 million vehicles

in 2007, has partnered with AG Auto with the promise to bring new dimension in the

automobiles industry of the country.

AG Auto has constructed a state-of-the-art sales and service centre by incorporating the

Corporate Identity of Ford, and is committed to render the highest standards of customer

satisfaction.

Abdullahpur, Uttara, Dhaka - 1230, Bangladesh

Ph: 8911880, 9564033

Fax: 88-02-9564020

Aston Martin United Kingdom 1989 to 2007 Global

Volvo Sweden 1999 to 2010 Global

Land Rover United Kingdom 2000 to 2008 Global

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E-mail: ford@anwargroup.com

Web: anwargroup.com/ford

Why Ford Came into Bangladesh

Commercial relationship between Bangladesh and the United States will be further

enhanced as the world-renowned Ford Motors of America extended their business to the

country.“The economic growth of Bangladesh will increase day by day for such reliable and

strong partner,” Commerce Minister Lt. Col. (retd) Faruk Khan Monday said while inaugurating

the showroom and service centre of Ford Motors at Abdullahpur in the city’s Uttara area. The

motor company will run its business in Bangladesh under the management of AG Automobiles

Limited of Anwar Group. Requesting the American company to develop their customer

service in the country, the minister also hoped that the Ford Motors would come forward in

social welfare activities, especially for the welfare of the labourers and the poor, according to

reports.

Motor Car Trends in Bangladesh

The trend and popularity of motor car is increasing day by day in Bangladesh.

Surprisingly, not only the young generation but also middle age even an increasing number of

older pupils are considering having a car. The trend is much higher in the capital Dhaka and

Chittagong. The most obvious reason behind that is, the amount of traffic in the roads.

Bangladeshi auto industry continued to grow in 2000, on target to breach 200,000 units of

brand new vehicles. Bangladeshi car buyers enjoyed a healthy slate of new models, with multiple

launches nearly every month of the year. The year was neatly bookended with the launch of an

American icon, and the return of a Japanese economy model.

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No of car importer in Bangladesh:

The number of car and car parts importer are increasing day by day and that is the

indicator that no of car user of Bangladesh is huge. So, where people can trust the importer and

their imported cars even most of the cars are imported from Japan those are mainly recondition

car. so why not ford, because ford has its own showroom in Bangladesh, where people can

choose their brand new car with high satisfaction. HSB Car's, Al-Marjuk Trading , Auto

Plus ,S.N. Motors ,Hoqu's Auto, Mile Stone and so many importer who imports car in

Bangladesh. So it's also an indicator that Bangladeshi people are love to use different model of

cars.

Rise of the sports cars:

Economy is all well and good, but we still need cars that teenagers can put up on their

bedroom walls, and adults can use as wallpaper for their computer screens. 2000 was the year of

the sports car, in one important way-affordability. Automakers brought out a gaggle of models

that are within reach of anyone in the market for an executive car. Because the young people are

becoming more fascinated with sports car now a days ,so for can serve them a list of sports car

those are worldwide popular.

Ford sports car: 2011 Ford Shelby GT350, 2011 Ford Mustang V6, Ford Mustang GT, 2011

Ford Fusion, Ford Shelby GT500, Ford Focus RS, Ford Fiesta ST500, Ford Shelby GT500KR,

Ford Interceptor Concept etc now we can see in Bangladesh road.

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Ford and Bangladesh Market For Car Business

A measure of the amount of sales or adoption of a product or service compared to the

total theoretical market for that product or service. The amount of sales or adoption can be an

individual company's sale or industry while the theoretical market can be the total population or

an estimate of total potential consumers for the product. In Bangladesh there are 154.7million

people in a country and the economic condition of Bangladesh is growing day by day so if now

approximately 10 million of those people have cars then the market penetration of cars would be

approximately 22%,which may be a good sign of growth for car makers. In general, the older the

offering or industry, the greater the market penetration.

Bank Car Loan Scheme In Bangladesh

Now a car is no longer luxury but necessity. Moreover, a car is more than a symbol of

prestige. All banks of Bangladesh offers you to materialize your dream of owning a car through

car loan facility.

Any Bangladeshi individual who has the means and capacity to repay bank loan ; In

specific terms, these could be salaried executives of multinational and middle to large size local

corporate, Government officials, Officials working in reputed NGOs (Non-Government

Organizations), international aid agencies & UN bodies, any tax paying businessmen of repute,

any employed / self-employed tax-paying individual having a reliable source of income. They

Can easily to get Auto Loan from Any Bangladeshi Bank.

Target Market& Customer

The organization like Ford motors is using Differentiated Strategy in their businesses.

This strategy is to targets two or more segments by developing marketing mix for each segment.

Ford Motor Company designed to appeal to many different types of consumers and to satisfy

many different needs in the form of economy cars, sports cars, luxury cars, station wagons, vans,

trucks, and so on. So, we can say that in Bangladesh ford target customer are everyone, Because

they provide all types of cars based on the customer needs.

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SWOT Analysis of Bangladesh for MNC business propose

Strengths Weaknesses

Large presence of multinational

enterprises in electronics and automotive

sectors.

Poor quality education and inadequate

supply of skilled labour.

High competitiveness ranking. High competitiveness ranking

Relatively young population. Little entrepreneurship and venture

capital .

Opportunities Threats

High-technology exports. Competition from other Asian

economies.

Islamic banking and finance centre. Political instability.

High corruption. Impacts of regional and global economic

downturns.

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conclusion:

Requesting the American company to develop their customer service in the country, the

minister also hoped that the Ford Motors would come forward in social welfare activities,

especially for the welfare of the labourers and the poor, according to reports. Commercial

relationship between Bangladesh and the United States will be further enhanced as the world-

renowned Ford Motors of America extended their business to the country.

Ford is known the world over for reliable, affordable automobiles that suit the varying lifestyles

of the modern world. From the Model T, the car that first brought driving to the masses, to more

recent favourites like Focus, Mustang and Explorer, Ford vehicles have been among the world’s

most popular cars and trucks While value for money has always been a top priority in developing

Ford vehicles, that concern has never compromised quality or the pursuit of quality solutions.

Ford has always focused on consumers’ real-life requirements from smaller cars for modern

cities , to “smarter” cars for the ever-changing environment AG Automobiles Ltd. (AG Auto) a

concern of ANWAR GROUP, was incorporated in August 2004 with a view to rejuvenating the

country’s transport sector. AG Auto took up projects to create awareness of cleaner environment

directly amongst the commercial vehicle owners. Long-term soft loan financing was bundled to

vehicle owners to make the switch from diesel to environment friendly Compressed Natural Gas

(CNG). Commitment and performance led to getting attention from other world-renowned

automobile brands seeking to enter and penetrate the automobile market of Bangladesh.

Consequently, AG Auto received distributorship rights of Global Automobile Icon “Ford Motor

Company”. Ford, the third largest automaker of the world with production of 6.553 million

vehicles in 2007, has partnered with AG Auto with the promise to bring new dimension in the

automobiles industry of the country. AG Auto has constructed a state-of-the-art sales and service

centre by incorporating the Corporate Identity of Ford, and is committed to render the highest

standards of customer satisfaction.

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References:

www.anwargroup.net/html/s_automobiles.asp

www.asiapacific.ford.com

www.ford.com

www.fordfoundation.org

www.wikipedia.com