Ford presetation
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Transcript of Ford presetation
FORD MOTOR COPANY
• FEI XIAO 3741353• WENBIN SONG 2875057• TRAN KHANH HUNG 3580785• YUNQI ZHANG 3508321• PHAM TUAN DUONG 3580800
• Background
• Financial performance review
• Internal analysis
• External analysis
• SWOT analysis
• Suggested strategies
• Conclusion
Introduction
• The second largest automaker in the U.S. and the fifth-largest in the world
• Founded by Henry Ford and incorporated on June 16, 1903
• Based in Dearborn, Michigan, a suburb of Detroit
• Owns a small stake in Mazda in Japan and Aston Martin in the UK
• Former UK subsidiaries Jaguar and Land Rover were sold to Tata Motors of India in 2008.
• Over 164,000 employees world-wide
• Feel the difference
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
Background
• Revenue decreased after 2007
• Net Profit floating situation
•Positive profit 2009
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
2005 2006 2007 2008 2009 2005 2006 2007 2008 2009
Net profit (billion)
2 -12.4 -2.8 -14.8 2.7
Revenue (billion)
177.1 160.1 169 143.6 116.3
-15
-5
5
15
25
-125
-75
-25
25
75
125
175
Revenue and net profit 2005 - 2009Profit Revenue
Revenue & Profit
• 2005-2009 : revenue decreased 34.3%profit increased 35%
Cost control program (start from 2006) has been effective
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
Cost control
High gearing (>40%)•High financial risk•High interest payable
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
Gearing and Liquidity
2005 2006 2007 2008 20090.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
Gearing ratios
FORDTOYOTA
Strong liquidity•Cash balance of $21,804 million in
2009 suggests no liquidity problems
• Share price is recovering at around $10 (12/2009) from around $2 (12/2008)
Increasing shareholder wealth
• No dividend paid out during 2006-2008
potential conflict between managers and shareholders
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
Shareholder Information
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
Value Chain
Firminfrastructure
HRM
Technology development
Procurement
Big Three in the US. Just-in-time scheduling. Shifting manufacturing to lower-cost locations. Collaboration.
Leading managers, recruitment and training cheap labour . Cut off staff due to excess capacity – laid off paid
Working closely with suppliers to eliminate waste and thereby lower costs for both (win-win)
Using information technology to improve logistic processes, designing, manufacturing, marketing and sales
Inbound logistics
Operation Outbound logistics
Sales and marketing
Servicing
•Design phase•C1 platform system using for producing range of new products•Adopting Lean Manufacturing practices
•Creating together marketing strategies with dealers•CRM &SAS* provides powerful based information analysis
•Caterpillar Logistics &SAP* to improve warehousing
•Daily Parts Advantage network with dealers->speed up time to market ->optimize each location inventories
*SAS: Statistical Analysis System *SAP: Systems Applications and Products
•After sale service•Financial services
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
VRIO Model
Valuable
• The Loan 23.6$b in 2006 makes Ford survive
• Electronic-cars production plan
Rare
• “Fordism” was the first major revolution in process technology
• Efficiency managers
Imitability
• Design phase• Economies of Scale• Brand Loyalty• Network of dealer.
Organization
• Ford exploit cheap market’s labor and invest for advertising in China market
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
Resource Audit Analysis
Human• Number of skillful employees• “Encourages fresh new thinking
and breakthrough ideas” culture• Be trained before working --(S)--
Physical• The biggest problem is excess
capacity (W)• Elimination of stockholders’
equity (W)• Low cost location of factories (S)
Financial• Change short-term financial to
long-term finance (W)• Unfunded pension, health care
and life insurance obligations negatively impact the cash flow position. (W)
• Strong operational and financial performance – making profit ( S)
Intangible• Relationship with suppliers
displaced from “first-tier” to “contract-based”. Number of suppliers reduce ( W)
• Good after sales service (S)• Brand name (S)
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
PEST - Political & Economic Factors
Political Factors Economic Factors
Support from governments Excess Capacity lead to spending heavily on marketing and new product design
Some policies control the discharge (Road tax in UK)
Economic recession and financial crisis –> the auto industry has to restructure , M&A
Unleaded petrol tax Fuel price has been increasing instantly
Forced Groups (Labour unions) will have strong reaction if Ford start cutting the number of labour
The growth potential markets (BRIC markets - Brazil, Russia, India, China)
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
PEST – Social & Technological Factors
Social Factors Technological Factors
Car culture E-commerce
Fashion design( meet customer requirement) Rapid development of technology (new energy systems)
Travel habit, the rising demand of family cars
Global warming issue
Ford Honda
Big space Small space
Heavy Light
Fuel consumption high
Fuel consumption low
• Substitutes: public transportation
• Travelling door to door must use car
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
Porter’s 5 forces Analysis
•Mature market•Price wars•Large number of competitors
Buyers’ Power
High
Threat of Substitutes
Threat of new
entrants
Suppliers’ Power
High entry and exit barriers• Labour• High investment• Technology• Supplier alliance• Brand
Asian companies globalization
•Large number of substitutes
•Over capacity•Large purchase•Second hand market
•Switching cost (high & low)
•BMW engine support some manufacturers
•Suppliers’ becoming independent
Competitive
Low
Low
Medium
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
BCG Matrix
High
Low
High Low
Mar
ket G
row
th
Competitive Position
CARS
SUVs
TRUCKS
COMER-TRUCKS PINTO
E-CARS
LAND ROVER
JAGUAR
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
Product Life Cycle
CARS TRUCKSCOMER-TRUCKSSUVs
E-CARSPINTO
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
Portfolio Analysis
Summary
Revenue unlikely continue growing up Future revenue could be come from Cars Some types of trucks, SUVs could change to dogs
Too many cash cows
• AdvantagesFord still receives revenue from SBUs of cash cows
• DisadvantagesThe future growth of cars might not cover enough
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
Strategic groups
•BMW
•MITSUBISHI
• HONDA
• NISSAN
• FIAT
• MAZDA
• GM
• TOYOTA
• VOLKSWAGEN
• FORD
• DAIMLER CHRYSLER
Pric
e
Companies’ Size
high
small
low
big
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
SWOT
Strengths
• Strong financial performance• Good financial services• Effective operation process
(R&D, logistic, HRM..)• Good relationship with dealers• Strong brand name
Weakness
• Overcapacity• Unprofitable areas• Adopted long-term debt
strategy• Huge unfunded pensions and
other obligations• Reduction in equity, good-will
and other intangible assets
Opportunities
• The growth of new markets (BRIC)
• New type of cars required (e-cars, fuel - affection cars)• The whole industry is
restructuring
Threats
• Government regulation• Long-lasting of economic
recession • Car demand is declining due
to fuel price rising• Competitors is more power
by M&A• Suppliers have more power
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
SWOT in Action
Use of S to take advantage of O• Developing new type of cars (family cars & electronic cars)• Developing new market s in Asia and Africa • Investing money for marketing in rasing markets
Use of S to avoid T• Continuing control cost -> low car price (with popular cars)• Remaining relationship with good dealers• Making alliances with other automakers
Overcoming W by take advantage from O• Change to produce small cars and family cars• Funding salary and pension alternatively (share, preferred share)
Minimize W to avoid T- Remove unprofitable areas
SO
ST
WO
WT
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
Corporate Strategies Model
Growth Retrenchment
Indu
stry
Att
racti
vene
ss
H
L
Competitive PositionWeakStrong
1. Diversification • Develop rank of product,
highlighting in family car and small cars
2. Turn around strategy• Improving efficiency by
tracking market demand • Reduce staff cost• Remove Pinto, Land
Rover and Jaguar
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
Ansoff’s Model
Present Products/Services
New Products/Services
Present Markets
Product development
• Improving fuel – efficiency energy system
• Improving car’s design
Pushing up develop electronic cars
New Markets
Market development
• African Market
Diversification
• Cars
• Services (insurance)
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
Bowman’s Strategy Clock
Perceived Added Value
Price
High
HighLow
Low
Hybrid strategy• Providing low
prices, small engines high pickup andmileage cars
Pure battery electric vehicles• Coming with bio-fuel and
electronic cars
3
2
1
4
5
6
7
8
Conclusion
• Auto industry was engulfed by the financial crisis
• Auto Industry has been evaluating in term of new market
demand and manufacturing technology
• Ford has been undergone the crisis, the accurate business
adopted could help Ford achieve long term success
Conclusion & Recommendation
Recommendation
Continuing Cost control program
Pushing up bio-fuel and electronic cars
Background
Finance
Internal
External
SWOT
Strategies
Conclusion
Contact
Thank you for listening !