Market and Market Share of Ford Motor Company - Essay Example

History Ford Motor Company founded in 1903 is one of the world’s leading automotive companies. The company was founded by Hendry Ford. The company deals with automotives and other related services such as extending credit to customers. Its mission is the continuously development of commodities to reach the target customers, to develop their business and to meet the goals of the company`s shareholders. The mission statement of Ford Motor Company is guided by the following principles; one Ford, one team, one plan and one goal. The vision statement of the institution is to be the leading company in the world on provision of products and services (Ford Motor Company 2011). Market and market share of Ford Motor Company Ford Motor Company has a large market share. Automotive segments of Ford Motor Company include; Ford North and South America, Ford Asia and Africa region and Ford Europe. The market share of Ford Motor Company for the last 9 months has risen significantly to 15.8 percent. This is higher as compared to the market share of the year 2012 which was 15.2 percent in US. However, the market share of Ford Motor Company is estimated to increase by 7.4 percent. This means that the company will be able to make auto sales of 15.9 million up from 2012 sales of 14.8 million (Young, 2013). There is a very high competition in the international market yet Ford remains consistently competitive. In Europe, the analysis of Ford products shows that it is the second best seller in the past five years. This is attributed to the best performance the company has made recently in Russia and UK (Vlasic 2011). Organizational leadership Ford Motor Company is a global leader in manufacturing and sales of automotive products. The company distributes its manufactured vehicles in approximately 200 markets across the world. Ford also has other responsibilities such as servicing and offering of credit to interested parties. The company employs quite a number of people in all industries (Forever Ford 2014). Macro environmental analysis Ford motor company has its operations in many parts of the world; for example, it has subsidiaries in countries like UK, Australia, China, and Japan. Political stability in those countries is favourable. This means that business can be conducted without any interference from governments. This has given the opportunity to Ford Motor Company to excel in market share, in various countries. Economy Economic challenges in the world have seriously affected companies including Ford Motor Company. Many companies were forced to withdraw from the business but others adjusted their production and reduced the work force. The economy is currently improving and companies are picking up. Ford motor company in recovering and has made strategic plans that suit the current economy (Senna, 2013). Social values There are emerging markets in different parts of the world because of the change in social class. Ford Motor Company has to take advantage of this and explore the emerging markets because such markets are an opportunity and demand is high for automobiles (Senna, 2013). Technological change The company should invest in technology for better production of automobiles that are well versed to changes in technology. Customers require vehicles that consume less fuel. Companies can meet customers` need by investing in technology (Senna, 2013). Management Ford Motor Company implemented management functions such as planning, organizing, leading, and controlling to make it in the automobile industry. This is because the company was facing serious competition from the rivals including Toyota and Nissan. The plans made by the company were to reduce the cost of business. This was done by reducing production and the cutting down of the work force. Marketing The primary product of Ford Motor Company is automobiles and they are developed under Ford and Lincoln. The company manufactures different products such as passenger vehicles, trucks, commercial vehicles, SUVs, sports cars, convertibles, and other brands. Price of the products is determined by the type of product and it is accounted based on the type, cost and other related products competing with the company. The company distributes its products including automobiles and spare parts to all parts of the world through different centres set up by the company. Ford motor company engages its customers through online means. This part of communication adopted by the company is best because they are able to demonstrate some of its products online (Young, 2013). Porter’s five forces of competition Competition is high in the automobiles industry. For example, in US, Toyota, General Motors and Ford are some of the automobile companies competing for market share. However, companies are trying their best to attract customers to purchase their products. Ford Motor Company uses the strategy of volume and scale to make it in the industry. New entrants in the industry have found it difficult because the industries currently in the market have invested heavily in different aspects such as technology and finance. They also have more experience in the industry. However, automobile industries from China have easily entered the market because of cheaper automobile products they offer (Senna, 2013).Substitutes such as trains, bicycles and buses do not pose a serious threat on Ford Motor Company and the industry at large. Buyers The inflation and interest rate in the current economy have had more impact on the buyers in the automobile industry. Companies are competing for customers because most of them offer similar products. Each company offers different incentive to attract customers. Ford motor company offers free services to their customers. Suppliers The company reduced some of its suppliers to gain in the industry and obtain cheaper products. This is because suppliers are also competing so they reduce the price of the products used in the industry (Senna, 2013). Swot analysis Strength The Company is valued by customers all over the world. The company has a strong brand name built since its inception. The company distributes its products to most parts of the world. The wide distribution network builds the strength of the company. Weaknesses The Company operates in debts. The high interest rates affect the company’s production and the resources. They have had low penetration in the international markets. Threats Production and global operation have been affected by economic recession. The financial crisis has increased the cost of production because the cost of raw materials also increased Competition from other companies offering similar products are a threat. Opportunities Emerging markets is the right opportunity for expansion of Ford Motor Company. Bankruptcy of its major competitors such as General Motors and Chrysler is also an opportunity to the Company. The current economic crisis can be an opportunity for expansion (Senna, 2013). Open system analysis Raw materials are obtained by the company from the suppliers. The raw materials are supplied to Ford industries where they are converted to products based on the design of the automobiles they require. Various elements are used during the manufacture of the product. For example, plants of Ford Company require electricity during the production process. The company has recently resorted to renewable energy to save the environment from emission of greenhouse gases. The output is automobiles of different design, colours and size. Value chain analysis Procurement takes up the biggest share of the value chain of Ford Motor Company. The company is working together with the suppliers to reduce the cost on both sides. Additionally, the company is focusing on the design of the products. This is because customers need the best designed products. The company has invested on various designers of automobile products (Senna, 2013). Core competencies analysis Ford Motor Company provides high quality products to the customers. The company products serve all the customers from all the levels in all parts of the world. Ford Motor Company has the most competitive assembly line. Additionally, the company has invested on the human resource of the company to continue innovation of products to meet customers’ needs. Machines used by the company in their factories are flexible. This means that they can be easily programmed to meet the needs or to perform the task required. The company also is on the verge of producing the most flexible engines that are well versed with the current changing economy. Furthermore, the company has implemented marketing techniques that capture customers’ attention (Ford Media, 2002). Current strategies The current strategy adopted by the company is to restructure its operation in order to increase its profits and meet the customers demand. The company is also considering increasing development of new products and services which customers need. Additionally, plans are underway to increase financing and improvement of the company’s balance sheet. Based on the above analysis of the company, they should review the threats and opportunities they have as stated on the swot analysis. For example, the study shows that there is high competition in Europe. However, emerging markets such as China and Asia should be the right market for the company. Additionally, they should take advantage of the current increase in the price of fuel, the stringent controls on emission and make vehicles that are fuel efficient and environmentally friendly (Vlasic, 2011). References Ford Media. (2002) Global Manufacturing Strategy Gives Ford Competitive Edge. Retrieved from: http://media.ford.com/article_display.cfm?article_id=13633 Ford Motor Company. (2011). Retrieved from http://cowgirlkitty41.wordpress.com/2011/04/17/ford-motor-company/ Senna, A. (2013). Competitive advantage Ford Motor Company. Retrieved from http://wpsenna.wordpress.com/2013/06/04/competitive-advantage-ford-motor-company/ Vlasic, B. (2011). Ford strategy will call for stepping up expansion, especially in Asia. Retrieved from http://www.nytimes.com/2011/06/07/business/07ford.html?_r=1& Young, A. (2013). Ford Motor Co. (F) Sees Total 2013 New Vehicle Sales Up 14.2% In China, Up 7.4% In U.S., Down 2.9% in Europe. Retrieved from http://www.ibtimes.com/ford-motor-co-f-sees-total-2013-new-vehicle-sales-142-china-74-us-down-29-europe-1439760 Read More