1. FORD MOTOR COPANY
• FEI XIAO 3741353
• WENBIN SONG 2875057
• TRAN KHANH HUNG 3580785
• YUNQI ZHANG 3508321
• PHAM TUAN DUONG 3580800

2. Introduction
• Background
• Financial performance review
• Internal analysis
• External analysis
• SWOT analysis
• Suggested strategies
• Conclusion

3. Background
Background
• The second largest automaker in the U.S. and the fifth-
largest in the world
Finance
• Founded by Henry Ford and incorporated on June 16, 1903
Internal • Based in Dearborn, Michigan, a suburb of Detroit
External
• Owns a small stake in Mazda in Japan and Aston Martin in
the UK
SWOT • Former UK subsidiaries Jaguar and Land Rover were sold to
Tata Motors of India in 2008.
Strategies • Over 164,000 employees world-wide
• Feel the difference
Conclusion

4. Revenue & Profit
Background Revenue and net profit 2005 - 2009
Profit
Revenue
Finance
• Revenue decreased 30 200
after 2007 150
20
100
Internal • Net Profit floating
10
situation 50
External 0
0
• Positive profit 2009
-50
-10
SWOT -100
-20 -150
2005 2006 2007 2008 2009
Strategies
Net profit (billion) 2 -12.4 -2.8 -14.8 2.7
Revenue (billion) 177.1 160.1 169 143.6 116.3
Conclusion

5. Cost control
Background
• 2005-2009 : revenue decreased 34.3%
Finance
profit increased 35%
 Cost control program (start from 2006) has been
Internal effective
External
SWOT
Strategies
Conclusion

6. Gearing and Liquidity
Background
Gearing ratios
Finance
High gearing (>40%) 70.00%
•High financial risk 60.00%
•High interest payable 50.00%
Internal 40.00%
FORD
30.00% TOYOTA
20.00%
External
10.00%
0.00%
SWOT 2005 2006 2007 2008 2009
Strong liquidity
Strategies •Cash balance of $21,804 million in
2009 suggests no liquidity problems
Conclusion

7. Shareholder Information
Background
Finance
• Share price is recovering at around $10 (12/2009)
from around $2 (12/2008)
Internal  Increasing shareholder wealth
External
• No dividend paid out during 2006-2008
SWOT
 potential conflict between managers and shareholders
Strategies
Conclusion

8. Value Chain
Background Firm Big Three in the US. Just-in-time scheduling.
infrastructure Shifting manufacturing to lower-cost locations. Collaboration.
Finance HRM Leading managers, recruitment and training cheap labour .
Cut off staff due to excess capacity – laid off paid
Internal Technology Using information technology to improve logistic
development processes, designing, manufacturing, marketing and sales
Working closely with suppliers to eliminate waste and thereby
External Procurement lower costs for both (win-win)
Inbound Operation Outbound Sales and Servicing
logistics logistics marketing
SWOT
•Caterpillar •Design phase •Daily Parts •Creating together •After sale
Logistics &SAP* •C1 platform Advantage marketing service
Strategies to improve system using for network with strategies with •Financial
warehousing producing range dealers dealers services
of new products ->speed up •CRM &SAS*
•Adopting Lean time to market provides powerful
Conclusion Manufacturing ->optimize based information
practices each location analysis
inventories
*SAS: Statistical Analysis System *SAP: Systems Applications and Products

9. VRIO Model
Background
Valuable Rare
Finance
• The Loan 23.6$b in 2006 • “Fordism” was the first major
makes Ford survive revolution in process
Internal • Electronic-cars production technology
plan • Efficiency managers
External
Imitability Organization
SWOT
• Design phase • Ford exploit cheap market’s
Strategies • Economies of Scale labor and invest for
• Brand Loyalty advertising in China market
• Network of dealer.
Conclusion

10. Resource Audit Analysis
Background Human Physical
• Number of skillful employees • The biggest problem is excess
Finance • “Encourages fresh new thinking capacity (W)
and breakthrough ideas” culture • Elimination of stockholders’
• Be trained before working equity (W)
Internal --(S)-- • Low cost location of factories (S)
External
Financial Intangible
• Change short-term financial to • Relationship with suppliers
SWOT
long-term finance (W) displaced from “first-tier” to
• Unfunded pension, health care “contract-based”. Number of
Strategies and life insurance obligations suppliers reduce ( W)
negatively impact the cash flow • Good after sales service (S)
position. (W) • Brand name (S)
Conclusion • Strong operational and financial
performance – making profit ( S)

11. PEST - Political & Economic Factors
Background
Political Factors Economic Factors
Support from governments Excess Capacity lead to spending heavily on
Finance marketing and new product design
Some policies control the discharge Economic recession and financial crisis
(Road tax in UK) –> the auto industry has to restructure , M&A
Internal Unleaded petrol tax Fuel price has been increasing instantly
Forced Groups (Labour unions) will have strong The growth potential markets (BRIC markets -
External reaction if Ford start cutting the number of Brazil, Russia, India, China)
labour
SWOT
Strategies
Conclusion

12. PEST – Social & Technological Factors
Background
Social Factors Technological Factors
Car culture E-commerce
Finance
Fashion design( meet customer requirement) Rapid development of technology (new energy
systems)
Internal
Travel habit, the rising demand of family cars
External Global warming issue
SWOT Ford Honda
Big space Small space
Strategies
Heavy Light
Conclusion Fuel consumption Fuel consumption low
high

13. Porter’s 5 forces Analysis
Background Buyers’
• Substitutes: public •Large number of
Power substitutes
transportation
Finance • Travelling door to •Over capacity
door must use car
High •Large purchase
•Second hand market
Internal
Competitive
•Mature market Threat of
External
Low
Threat of •Price wars
Low
new
Substitutes •Large number
of competitors entrants
SWOT
High entry and exit barriers
Strategies •Switching cost
• Labour
(high & low) Medium • High investment
•BMW engine support
• Technology
Conclusion some manufacturers Supplier • Supplier alliance
•Suppliers’ becoming
s’ Power • Brand
independent
Asian companies globalization

14. BCG Matrix
Background
High
Finance
CARS
E-CARS
Internal
Market Growth
External
SUVs
SWOT TRUCKS
COMER- LAND
TRUCKS ROVER
PINTO
Strategies JAGUAR
Low
Conclusion High Competitive Position Low

15. Product Life Cycle
Background
Finance
TRUCKS
CARS
Internal COMER-TRUCKS
SUVs
PINTO
External
E-CARS
SWOT
Strategies
Conclusion

16. Portfolio Analysis
Background Summary
Finance  Revenue unlikely continue growing up
 Future revenue could be come from Cars
Internal  Some types of trucks, SUVs could change to dogs
External  Too many cash cows
SWOT • Advantages
Ford still receives revenue from SBUs of cash cows
Strategies • Disadvantages
The future growth of cars might not cover enough
Conclusion

17. Strategic groups
Background
high
Finance •BMW
•MITSUBISHI
Internal • HONDA
• GM
• NISSAN
• TOYOTA
Price
External • FIAT
• VOLKSWAGEN
• MAZDA
• FORD
SWOT
• DAIMLER CHRYSLER
Strategies
low
Conclusion small big
Companies’ Size

18. SWOT
Background Strengths Weakness
• Strong financial performance • Overcapacity
Finance • Good financial services • Unprofitable areas
• Effective operation process • Adopted long-term debt
(R&D, logistic, HRM..) strategy
Internal • Good relationship with dealers • Huge unfunded pensions and
• Strong brand name other obligations
• Reduction in equity, good-will
External
and other intangible assets
Opportunities Threats
SWOT
• The growth of new markets • Government regulation
(BRIC) • Long-lasting of economic
Strategies • New type of cars required recession
(e-cars, fuel - affection cars) • Car demand is declining due
• The whole industry is to fuel price rising
Conclusion restructuring • Competitors is more power
by M&A
• Suppliers have more power

19. SWOT in Action
Background
Use of S to take advantage of O
SO • Developing new type of cars (family cars & electronic cars)
• Developing new market s in Asia and Africa
Finance
• Investing money for marketing in rasing markets
Use of S to avoid T
Internal
• Continuing control cost -> low car price (with popular cars)
ST • Remaining relationship with good dealers
• Making alliances with other automakers
External
Overcoming W by take advantage from O
SWOT • Change to produce small cars and family cars
WO • Funding salary and pension alternatively (share, preferred share)
Strategies
Minimize W to avoid T
Conclusion WT - Remove unprofitable areas

20. Corporate Strategies Model
Background
Finance H
Retrench 1. Diversification
Growth
ment • Develop rank of
product, highlighting in
Industry Attractiveness
Internal
family car and small cars
External 2. Turn around strategy
• Improving efficiency by
tracking market demand
SWOT • Reduce staff cost
• Remove Pinto, Land
Rover and Jaguar
Strategies L
Strong Weak
Competitive Position
Conclusion

21. Ansoff’s Model
Background
Present New
Finance
Products/Services Products/Services
Internal Product development
Pushing up develop
Present • Improving fuel – efficiency
electronic cars
External Markets energy system
• Improving car’s design
SWOT Diversification
New Market development
• Cars
Markets • African Market
Strategies • Services (insurance)
Conclusion

22. Bowman’s Strategy Clock
Background
High Hybrid strategy Pure battery electric vehicles
• Providing low • Coming with bio-fuel and
Finance prices, small engines electronic cars
high pickup and 4
mileage cars
Internal 3 5
Perceived
Added
External Value
2 6
SWOT
7
Strategies 1
8
Low
Conclusion
Low Price High

23. Background Conclusion & Recommendation
Conclusion
Finance
• Auto industry was engulfed by the financial crisis
Internal • Auto Industry has been evaluating in term of new market demand and
manufacturing technology
External
• Ford has been undergone the crisis, the accurate business adopted
could help Ford achieve long term success
SWOT
Recommendation
Strategies
Continuing Cost control program
Conclusion Pushing up bio-fuel and electronic cars

24. Thank you for listening !
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