ford - analysis
DESCRIPTION
Competetive AnalysisTRANSCRIPT
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Ford and the World Automobile Industry
Presented By:Shally Rathi
Vijay SangtaniAnuj Jain
Pooja Arora
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About The CompanyFounded June 16, 1903Founder – Henry FordHeadquarters Dearborn, Michigan, United
StatesProducts-Mainstream/Performance vehicles
Automotive partsFord is currently the world's fourth largest
automaker
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Crisis in Automobile Industry
Effect of 2008 oil price shock Crash of the credit marketsPressure to produce fuel efficient modelOverburdened Health insurance cost
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Issues of Ford1) Internal Issues:Lack of DialogueInadequate CooperationWeak accountabilityCross functional Conflicts2) Excess Capacity3) Inflexible Work Practices4) Slow New Product Development5) Erratic Decision Making
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SWOTStrengths:1. Strong Ford Asia, Africa and Ford Mazda
operations2. Growing Ford Europe and PAG3. Profitable Financial services division
Weakness:4. Weakening North American automotive
operations5. Tarnished brand image6. Large unfunded pension and other obligations
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Opportunities:1. Innovations2. Hybrid vehicles3. Continuing to expand globally
Threats:4. Rising fuel prices5. Growth of competitors6. Rising supply cost
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FIRM /BUSINESS UNITFORD
DIRECT CUSTOMERDEALERSHIP, FLEET AND CAR RENTAL COMPANIES
DEALERSHIP, FLEET AND CAR RENTAL
COMAPNIES
ENDUSERS
CUSTOMERS/DRIVERS
OTHER FIRM /BUSINESS UNITS
GM, TOYOTA. CRYSLER,HONDA
INFLUENCER
Car magazine, reviewsCar TV and radio shows
Environmental ActivistGroups, Calcars.org
Governments andgovernment agencies
PURCHASE DECISION MAP
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FIVE FORCE ANALYSIS OF AUTOMOBILE INDUSTRY
FORCE THREAT TO PROFIT
INTERNAL RIVALRY STRONG
ENTRY WEAK
SUBSTITUTES AND COMPLEMENTS
WEAK TO MODERATE
BUYER POWER WEAK
SUPPLIER POWER STRONG
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SUPPLIER POWER :• Differentiation of inputs • Presence of substitute inputs • Supplier concentration
•THREAT OF THREAT OF SUBSTITUTES Switching costs Buyer inclination to substitute Price-performance trade-off of substitutes
BARRIERS TO ENTRY• Absolute cost advantages• Economies of scale• Brand Identity
DEGREE OF RIVALRYProduct differences -Switching costs -Brand identity
BUYER POWERBuyer information Brand identity Price sensitivity
Rivalry
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Automotive Segments
SEGMENTS 2008 2007
FORD NORTH AMERICA 2329 2890
FORD SOUTH AMERICA 435 438
FORD EUROPE 1820 1918
VOLVO 359 482
FORD ASIA PACIFIC AND AFRICA 464 535
JAGUAR LAND ROVER AND ASTON MARTIN
125 292
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Competitive Analysis
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TQMJapan Westdeals with quality of
people customer-oriented upstream process-oriented, aimed
at improving the total performance
company-wide, everybody's responsibility
deals with quality of products
manufacturer-oriented downstream product-oriented, aimed
at detecting and eliminating defective parts
responsibility of quality control managers
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Measures for Revival
RestructuringCancellation of bonuses for management
employeesAmerica firstGoing green for real at a realistic price80% funding for hybrid or full electrical
vehicleSlimming and trimming
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Current Outlook Early signs of stabilizing in the US market share
Uses cash from its global automotive operations
Enough liquidity without additional funding
S&P gives CCC+ credit rating
Tender offer to reduce its debt by 38%
contract with UAW leading to insourcing
Ford FOCUS and ESCAPE - two of the top eight in Cash for Clunkers program
Competitive access to capital at Ford Capital
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Recommendations
Continued salaries cutSteady execution of company’s product
introductionsContinued discipline in the company’s
production/inventory strategyOutsourcing
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THANK YOU