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Hamill Bassue Owen Hendershot Goran Nagradic

Hamill Bassue Owen Hendershot Goran Nagradic. Overview. Company Overview Ford’s brief history Mission and Vision statement Current Objectives & Strategies New Mission and Vision External Assessment Industry Analysis Opportunities & Threats EFE Matrix Internal Assessment

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Hamill Bassue Owen Hendershot Goran Nagradic

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  1. Hamill Bassue Owen Hendershot Goran Nagradic

  2. Overview • Company Overview • Ford’s brief history • Mission and Vision statement • Current Objectives & Strategies • New Mission and Vision • External Assessment • Industry Analysis • Opportunities & Threats • EFE Matrix • Internal Assessment • Strengths & Weaknesses • Financial ratios • IFE Matrix • Strategy Formulation • SWOT Matrix • BCG • Space Matrix • IE Matrix • Grand Strategy Matrix • QSPM Matrix • Strategic Plan for the Future • Objectives • Strategies • Implementation • EPS/EBIT • Other issues • Evaluation • Ford 2008 Update

  3. About the Company • Manufactures and distributes automobiles on six continents, strong presence in all 50 states. • Employs approximately 224,000 people and operates 90 plants worldwide. • Brands include Ford, Lincoln, Mercury, Volvo, Mazda and Ford Motor Credit Company (financial service).

  4. Ford’s Brief History 1903 – Ford Motor Company founded in Michigan 1908 – Model T introduced 1913 – first moving automobile assembly line in the world 1956 – Ford’s stocks go on sale (10.2 million shares sold the first day) 1987 – beginning of the acquisitions of other brands 1988 – Ford Motor Company reached the peek

  5. Management

  6. Mission & Vision Statement "To become the world's leading consumer company for automotive products and services.“ - Ford doesn’t have vision statement

  7. Objectives • To contribute to stabilizing the climate by considering reducing long-term emission • To promote the development of an infrastructure that will expand the use of bio-fuels and help reduce our dependence on oil • To cut the usage of global energy by 27% and the usage of water by 25%

  8. Strategies • Utilizing their advance technology • Building of smaller vehicle • Cost reduction • Market expansion through joint venture and strategic alliance

  9. New Mission & Vision Statement • Both mission and vision are one statement “Our vision is to become the world's leading consumer manufacturing company for automotive products and services. To achieve this, we the company and all our employees are dedicated to provide all our customers and the community with safe innovative products and services of world class standards. Through our engineering excellence, high quality and the use of our constantly upgrading technology we limit the harm that we cause to the environment while delivering superior value to our customers. Our close knit working environment allows our employees, community and business partner to share in our success, while achieving a substantial return on our shareholders investment. “

  10. External Assessment

  11. Industry Analysis Global Automobile Industry Value Global Automobile Industry Volume

  12. Industry Segmentation

  13. Industry Segmentation

  14. Industry Market Share

  15. Industry Forecast

  16. CPM

  17. Opportunities & Threats Opportunities Threats Weak USD Increase in steel and resin pricing Increasing gasoline prices Stricter CO2 emission standards Increasing mortgage rates • Consumers demand hybrid and fuel efficient vehicles • Increase in consumer spending trends • Consumers demand more innovative vehicles • Global expansion • Industry experiences slow and steady growth

  18. EFE Matrix

  19. Internal Assessment

  20. Stock performance

  21. Financial Highlights • Income Statement • Balance Sheet • Cash Flow Statement

  22. Ratios

  23. Strengths & Weaknesses Strengths Weaknesses A lot of time spent to actually put the product on the market Recording continuous losses (net income) from 2006 Low quality of new products (recalls – causing losing customers) Lack of management of the company EPS very bad – in negative numbers (unattractive for the investors) • Strong and globally positioned brand names • Large employee base with highly educated engineers and good R&D department • One of the largest automotive manufacturer (along with a long history) • 1285% increase in net cash • Huge increase in total equity

  24. IFE Matrix

  25. Strategic Formulation

  26. SWOT Matrix

  27. SPACE Matrix FS Conservative Aggressive +6 +5 +4 +3 +2 +1 IS -6 -5 -4 -3 -2 -1 +1 +2 +3 +4 +5 +6 -1 -2 -3 -4 Defensive -5 Competitive -6

  28. BCG Matrix

  29. BCG Matrix Relative market share position in the industry High 1.0 Medium .50 Low 0.0 High +30 Medium 0 Low -3 SA Industry sales growth rate APA NA EU

  30. IE Matrix Hold and Maintain

  31. Rapid Market Growth Quadrant II Quadrant I Weak Strong Competitive Competitive Position Position Quadrant III Quadrant IV Slow Market Growth Grand Strategy Matrix

  32. Matrix Evaluation

  33. Possible Strategies • Developing new vehicles on alternative fuels (S1, S2, S4, O1, O3, O5) – SO1 • Offer new innovative products – increase market share (S1, S2, S3, O2, O3, O5) – SO2 • Concentrate on making the best fuel efficient cars (S1, S2, S3, S4, O1, O4, O5) – SO3

  34. QSPM

  35. Strategic Plan for the Future

  36. Objectives for the 2008 - 2010 • Reduce manufacturing expenses by 15-20% 2008 • Introduce new small fuel efficient vehicles 2009 • Enter Latin American and Asian market with hybrid vehicles 2010 • Develop affordable electric car for US market 2009-2010 • Increase market share 2009-2010 • Build up strong financials (increase net income and EPS by 15%) 2009-2010

  37. Recommendation • Manufacturing of new small fuel-efficient vehicle $ 7,000,000,000 • Entering the Latin American and Asian market with hybrids $ 20,000,000,000 • Implementation of electric car in the US market $ 13,000,000,000 Total Cost = $ 40,000,000,000

  38. Implementation

  39. EPS/EBIT • Amount needed: $40,000,000,000 • Stock price: $7.42 • Interest rate: 7.5% • Tax rate: 0% (firm is having a loss) • # of shares outstanding: 2,195,000,000 • # shares needed: 500,404,312

  40. EPS/EBIT *data in $ billion

  41. Other Issues • Laws and regulations in foreign countries • Regain lost trust in the Ford’s brand

  42. Evaluation

  43. Ford 2008 Update

  44. Industry Update

  45. Sources • Ford Motor Company Annual Report 2007 • General Motors Annual Report 2007 • http://www.ford.com/about-ford/investor-relations • Datamonitor • Global Automobile Industry manufacturer 2006 • Pictures taken from Web

  46. Questions???

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