Ford Market Analysis

1. Ford Market Analysis MGT 4380 Blake Preston Mason

2. Getting to know Ford Motor Company • Founded by Henry Ford in 1903 • Headquartered in Dearborn, Michigan • Assembly line and vertical integration have been major keys to success • Over 212,000 employees at plants and facilities worldwide

3. P.E.S.T. Analysis Political - Governmental Support / International Trade Agreements Economic - Growth of U.S. Economy / Strengthening of U.S. Dollar Social - Inc. Demand for Electric & Hybrids / Increasing Wealth Gap Technological - Technological Enhancement / Alternative Fuel Network

4. P.E.S.T. - Political • Governments aim to retain and grow industries • Political stability usually means economic stability • Government attitudes • Government regulations • Changes in design • Increased cost • Safety features • Fuel economy standards • Emission standards • Government bailouts

5. P.E.S.T. - Economic • The automotive industry is an important influencer on economy • Economic growth means more automobile buyers • Higher sales in developed countries • Inflation and rising interest rates are deterring average consumers • Oil dependency • Infrastructural development

6. P.E.S.T. - Social • Trends • Cultural forces • Environmental impact • Brand power • Demographics • Impact on lives • Help in the development of nations

7. P.E.S.T. - Technological • The automotive industry is a leader in innovation • Development of electric cars and the decreasing cost of electric car batteries • Autonomous driving technology • Environmentally friendly technology • Creating safer vehicles

8. Industry Description and Outlook • Large and highly competitive industry • Few majors players control large shares of the markets • Rapid expansion following the 2008 - 2009 recession • Steady decline beginning in 2017 • Rise in auto loan delinquency rates • Marketing shift to high wealth individuals • Sales of trucks, suvs, hybrid, and electric vehicles rising • Industry thought to decline in 2019

10. Target Market / Size / Trends • Ford does business in 62 different countries • Ford offers a variety of different vehicle options to suit the lifestyle and needs of consumers around the globe • Technology is a major area of focus • Second Largest US based automaker • Ford F-Series is top selling vehicle in the U.S. • Ford Mustang and Focus only car/sedan available after 2018

11. Competitive Analysis Direct competitors - Other big name brand automotive companies • Fiat Chrysler Automobiles • General Motors Company • Toyota Motor Corporation Indirect Competitors - Substitute automobiles / transportation • Uber • Different style vehicles

12. Competitors Strengths Market Share Research and Development Wide Product Portfolio

13. Competitors Weaknesses Dependence on US market Rigid hierarchical structure

14. Ford S.W.O.T Analysis Strength: • Market share in cars and light trucks was 14.8% August 2015, making it number two to General Motors • Research and Development Ford is allowed a big budget to work on new technology. • Ford’s market share was 7.2% in 2015 • Strong financial position reported free cash flow of $3.477 billion in June 2015.

15. S.W.O.T Analysis Weakness: • Product failures • Inability to match the production capabilities or sales volume of the top five automakers • Heavy dependence on U.S. and European markets. • Poor performance in emerging markets. • Blue collar/middle-class brand, makes it hard to market it to luxury buyers

16. S.W.O.T Analysis Opportunity: • Self driving/autonomous cars • Alternate fuel source; such as their existing C-Max Electric • Emerging markets like China, India, and Mexico

17. S.W.O.T Analysis Threat: • Increasing pressure from German and Japanese companies • Competing companies have head start on alternative fuel source • Reduction in amount younger generation is driving • Uber, Lyft, and other ride sharing companies

18. Barriers to Entry / Regulations -Funding -Years of Research -Volume / Cost of Production -Channels of manufacturing / distribution

19. Projections NADA • Slight decrease in sales in 2019 New Age of Automobiles • In 2020 Ford plans to release hybrid F-series • Fully electric, autonomous, and other hybrid cars

20. Citations Balan, Valery. “PEST Analysis on the Automobile Industry.” Academia.edu - Share Research, www.academia.edu/7033015/PEST_Analysis_on_the_automobile_industry. Britannica, The Editors of Encyclopaedia. “Ford Motor Company.” Encyclopædia Britannica, Encyclopædia Britannica, Inc., 3 Jan. 2019, britannica.com/topic/Ford-Motor-Company. “Global Car Sales 1990-2018.” Statista, Statista, www.statista.com/statistics/200002/international-car-sales-since-1990/ Investopedia. “How Much Impact Does Government Regulation Have on the Automotive Sector?” Investopedia, Investopedia, 29 Mar. 2018, www.investopedia.com/ask/answers/042015/how-much-impact-does-government-regulation-have-automotive-sector.asp. Pratap, Abhijeet. “Automotive Industry PESTEL/PESTLE/PEST Analysis by Cheshnotes.” Cheshnotes, 9 Mar. 2018, www.cheshnotes.com/2016/09/automotive-industry-pestel/. Pratap, Abhijeet. “PESTEL ANALYSIS OF FORD MOTORS.” Cheshnotes, 20 Feb. 2019, www.cheshnotes.com/2017/03/ford-pestel-analysis/. “2018 Automobile Industry Outlook | Prevedere BI Insights.” Prevedere, prevedere.com/insights/webinars/2018-automobile-industry-outlook/. “2019 Automotive Industry Outlook - Webinar.” Prevedere, prevedere.com/insights/webinars/2019-automotive-industry-outlook-webinar-thank-you/.