Ford Motor Company - Research Paper Example

 Table of Contents Table of Contents 2 Overview 3 Vision and Mission 3 Strategic Objectives 5 Financial Objectives 6 Company’s Strategy 8 Strengths 9 Conclusion 11 References 12 Overview The paper intends to discuss about a company that is listed on NYSE or NASDAQ. Ford Motor Company, which was established in the year 1903 by Henry Ford in Detroit, meets the requirement. Ford Motor Company, is the second-largest automobile company, and represents $164 billion international business domain. This leading international company has 224,000 employees worldwide and has 90 plants globally. The company’s core and associated brands include Ford, Mercury, Land Rover, Lincoln, Aston Martin, Volvo and Mazda (Ford Motor Company, “About Ford Motor Company”). Vision and Mission Company’s mission statement is reminiscent of a reflection of its core principle, identity, and values. Ford Motor Company operates its business throughout the world and endows with ‘personal mobility’ for the communities. The company is committed to serve the people with enthusiasm. Mission statement of Ford Motors is as following: “We are a global family with a proud heritage passionately committed to providing personal mobility for people around the world” (Missionstatements, “Mission Statement”). Ford Motors offers values for all its stakeholders. Ford Motors focuses on ‘one team’ consisting of all stakeholders such as customers, employees, suppliers, dealers and investors among others. Vision statement shows the future perspective of the company. The vision statement reads, “One Ford: One Team, One Plan and One Goal” (Ford Motor company, “One Ford Mission and Vision”). Strategic Objectives Organizations set up several strategies to operate business efficiently in international market. Ford Motor Company witnessed lots of strategic challenges during recession in the US. In the recent past, Ford Motors has redesigned a coherent business strategy. Ford emphasizes on ‘One Ford’ philosophy. Strategies implemented by Ford Motors Source: (Ford Motor Company, “Annual Report 2010”). Ford Motor Company focuses on meeting the customers’ requirements by providing them quality products. It enhances the efficiency of its plants and processes by adopting advanced technologies. Their strategies are chiefly based on ‘One Ford’ approach. Ford offers high-quality vehicles with global appeal such as ‘fuel-efficient cars’, competent utility vehicles, and ‘fun-to-drive’. They ensure continuous improvement driven by their strong product line. Ford Motors highlights on overall profitability. Ford Motors’ loyalties to excellent fuel economy, stunning style as well as customer-focused technology are demonstrated throughout its product line. Lincoln, one of the associated brands, is under focus to be established as a luxury brand to attain opportunities in the developing markets. Excellent quality, laser-sharp spotlight on client safety and fuel efficiency continue to make Ford Motors a market leader with the US consumers. Ford Motors looks forward to 70% of its development in the next few years to originate from its market segment of Asia Pacific and Africa. Ford Motors also expects to witness sustainable growth in emerging markets of India, Brazil and China (Ford Motor Company, “Annual Report 2010”). Financial Objectives The remarkable decline in automotive industry sales that came together with stiff credit markets along with the expenses associated with the changing business mode put major difficulty on automotive liquidity. Ford Motors witnessed record losses in 2008 during recession. They developed a feasible financial plan to sustain. The basic challenge of Ford Motors to be concentrated upon has been its failure to produce small vehicles in the US that can be put up for sale to generate more profit. Ford Motors informed net earnings of $6.6 billion in the year 2010, an increase of $3.8 billion from the year of 2009. Ford Motors’ Earning Per Share (EPS) in the year of 2009 was $0.86. In the year 2010, EPS of Ford Motors increased to an amount of $1.6 and the EPS in the year ended on 31st March 2011 was $1.77. The CEO of Ford Motors Alan Mulally declared in its Annual Report of 2010 that “Our 2010 results exceeded our expectations, accelerating our transition from fixing the business fundamentals to delivering profitable growth for all” (Rushe, “Ford Reports Best Profit Since 2000”). The enhancement in financial position of Ford Motors is guided by automotive segment in North America. Ford Motors continues to handle the operations for enduring profitable development. They focus on their core automotive brands. Ford Motors aims at enhancing its production capacity of light vehicles at a standard of 20 million units per year. This program is planned to be continued for the forthcoming five years, i.e. 2011 to 2015. The main objective of the company is to attain the opportunities in North American and European market as stated in the report of IHS Automotive (Ford Motor Company, “Annual Report 2010”). Company’s Strategy Ford Motors continues its aggressive strategies to close out idle factories, with a prominence on those factories within the US and European Union. Ford has taken certain strategies to fulfill corporate social responsibilities (CSR). In the year 2010, Ford Motors introduced eco-friendly vehicle model ‘Ford Taurus’ which is made of 85% recyclable materials. John Viera, Ford’s Director of Sustainability and Environmental Policy commented “More than ever before, the spirit of ONE Ford that drives our global product strategy also drives our commitment to sustainability” (Ford Motor Company, “Ford Is Making Greener Vehicles through Increased Use of Renewable and Recyclable Materials”) The primary restructuring of the operations of the company has influenced each part of business– ranging from product improvement as well as fuel efficiency to employee relations and relations with suppliers and traders. Ford Motors has taken up an initiative, namely Carbon Discloser Project (CDP) towards their social responsibility. Ford Motors is working in partnership with Georgia Institute of Technology in Atlanta to build up innovative processes that will facilitate to maintain their commitment to water reductions in China, India and other countries where they have faced challenges while operating in water-scarce conditions. Ford Motors is expecting to make an incremental investment of $850 million in the US-based plants between the year 2011 and the year 2013 to maintain extended manufacturing competencies for new ‘fuel-efficient, six-speed transmissions’ (Ford Motor Company, “Sustainability Report 2010-2011”). Strengths Ford Motors is recognized by the customers worldwide specifically in Europe for its strong brand name. Ford’s market share in the US, after global fiscal downturn, has stabilized in last two years. Appropriate acquisition of capital has helped Ford Motors to stabilize financial aspect of their business and make it strong than its global competitors. A wide range of product line can be considered as strength of Ford Motors. Mercury, Lincoln, Volvo, Land Rover, Aston Martin and Mazda are a few of the brands of Ford Motors. Ford has emphasized on fulfilling customer requirements e.g. customer safety while driving among others. Ford Motors offers value to its employees as well as suppliers. It aims to provide better working environment as well as competitive salaries to their employees. Ford Motors is perceived to be comprehensively an ‘American’ brand, which assists Ford Motors to gain definite clusters of consumers. The ‘Ford F-series’ pickup trucks continues to be the prime esteemed commercial truck available (Pomona College- Economics Department, “SWOT Analysis”). Strong financial structure can be identified as a major strength of Ford Motors. For instance, Ford Motors was recorded as one of the least affected automotive companies even after the recent global economic downturn, although, it was principally based in the UK and the US market (Hirsch, “Ford Posts $1.7-Billion Third-Quarter Profit”). Ford Motors is one of the leading car manufacturers in global automotive industry. They have standardized process of operating business which leads them to be a market leader. Ford Motors has taken certain initiatives for safe driving and to fulfill corporate social responsibilities (CSR). Ford Motors has over 5 million flexible fuel vehicles on road in the year 2010. They have restructured their operation to diversify their business globally. Ford Motors is focusing on its philosophy of ‘One Ford’ by implementing flexible process i.e. manufacturing process, sustainable technology and fuel alternatives (Ford Motors, “Annual Report 2010”). Conclusion Ford Motors has several approaches to attain competitive advantage over its competitors. The major competitors of Ford Motors are Toyota, General Motors, Volkswagen and Hyundai among others. To compete with the competitors, Ford Motors has to carefully plan its strategies. Ford Motors utilizes its opportunity to expand its business throughout India, China and other developing countries. Ford Motors can initiate its production in low-cost countries so that the operating costs remain low in next few years. The fuel price is significantly changing day-by-day and it may hamper the sales of luxury vehicles. Ford Motors has to initiate eco-friendly vehicles. They have to focus on bio-fuel substitutes in near future as the fossil fuel that is currently used for vehicles are stated to have hazardous impacts on the environment through carbon emissions. Ford Motors develops its business through continuous innovation and redesigning its strategies. References Ford Motor Company. “About Ford Motor Company”. July 14, 2011. Article, 2011. Ford Motor Company. “One Ford Mission and Vision”. July 14, 2011. Dynamic, 2011. Ford Motor Company. “Annual Report 2010”. July 14, 2011. Looking Forward, 2010. Ford Motor Company. “Ford Is Making Greener Vehicles through Increased Use of Renewable and Recyclable Materials”. July 14, 2011. Corporate Home, 2011. Ford Motor Company. “Sustainability Report 2010-2011”. July 14, 2011. Doc, 2011. Hirsch, Jerry, 2010. “Ford Posts $1.7-Billion Third-Quarter Profit”. July 14, 2011. Los Angeles Times, 2010. Missionstatements. “Mission Statement”. July 14, 2011. Fortune 500 Mission Statements, 2011. Pomona College- Economics Department. “SWOT Analysis”. July 14, 2011. Senior Seminars, No Date. < http://economics-files.pomona.edu/jlikens/SeniorSeminars/oasis/reports/F.pdf> Rushe, Dominic. “Ford Reports Best Profit Since 2000”. July 14, 2011. Guardian, 2011. Read More