ford case study competition

How Ford Adapted To The Changing Automobile Market

Table of contents.

Over its 118 year history, the Ford Motor Company has led the way in innovative technologies and leading business practices. 

Important stats to know about The Ford Motor Company: 

• Controls 13.9% of the US automotive market share in 2022
• Revenue of $136.3B in 2022  
• Headquartered in Dearborn, Michigan
• Produces over 4 million vehicles each year
• Employs over 182,790 employees around the world
• Ranked #21 in the Fortune 500
• Market value of $54.51 Billion as of Feb, 2023

{{cta('45b0c35f-370a-47ec-81e0-6922a2960023')}}

The History of The Ford Motor Company

Henry ford’s vision.

The Ford Motor Company has a long history that was inspired by Henry Ford, an Irish immigrant to the United States. Ford realized that the world’s transportation needs were quickly changing at the turn of the 20th century. His first attempt to design and build an automobile was in 1896 when he created his first vehicle — the quadricycle. The vehicle had a simple design with a bench seat for two passengers, a four-horsepower engine, bicycle wheels, and a gearbox with two speeds (but no reverse). 

Henry Ford on his “quadricycle” 

In November of 1901, Henry Ford joined the Detroit Automobile Company, a car manufacturing company, but his time there was short-lived. He left the company the following year. This company went on to become the Cadillac Motor Company (which was later purchased by General Motors). 

The Ford Motor Company was founded in 1903 when Henry Ford used $28,000 of investor money (about $800,000 in today’s money) to open a manufacturing facility. One of the early investors was John and Horace Dodge who would go on to create their own car manufacturing company. Because investors feared that Ford would leave the company like he did the Detroit Automobile Company, a local banker, John S. Gray was chosen as the first president. 

Leadership under the Ford family

Henry Ford did eventually become president and controlling owner of the company in 1906. Ford was directly responsible for the early success of the company including the popular Model T and innovative assembly line processes. He held this position until 1919 when his son, Edsel Ford, took over as company president. 

Edsel Ford was an artist and led the company to change the design of cars from practicality to visually appealing. The newly designed Ford vehicles were a hit with consumers all over the world. Edsel Ford died in 1943 and Henry Ford took back over as president of the company since Edsel was his only son.

Two years later, Edsel’s son, Henry Ford II took over as president and served from 1945 to 1960. The company had grown exponentially prior to his leadership. Henry Ford II worked diligently to solve many problems that plagued the organization. The bookkeeping was a mess and work processes needed to be heavily refined. Henry Ford II took it upon himself to transform the company into the polished and disciplined brand that it is today. 

Going public on the New York Stock Exchange

After a long run as a private (and mostly family-owned company), the Ford Motor Company went public in 1956. Traded under the NYSE stock ticker “F”, the IPO (initial public offering) for Ford was the largest IPO in history at the time ( $657 million worth of stock sold - $28.5 billion in today’s dollars ). 

Early competition

In the early years, the Ford Motor Company had a lot of competition. In fact, in 1920, there were approximately 200 car manufacturers in the United States . The largest companies that Ford was up against included General Motors and Chrysler. General Motors had many brands that proved formidable competitors including Chevrolet, Buick, and Cadillac. While the competition remained fierce, many of the early car manufacturers went out of business. By 1940, only 17 car manufactures remained. 

Becoming an International Brand

The Ford Motor Company owes much of its success to its expansion into international markets. The company was quick to do this shortly after its inception. The first international manufacturing facility was opened in Walkerville (now Windsor), Ontario in 1904. This was built directly across the Detroit River from Ford’s other manufacturing facilities at the time. The Ford Motor Company of Canada was established as a separate company with its own shareholders with the mission to sell Ford vehicles in Canada and other parts of the British Empire.

By 1908, Ford opened its first sales office outside of North America in Paris, France. Shortly after, Ford opened assembly plants across Europe between the years 1917 and 1925 in Ireland, England, France, Denmark, Germany, and Austria. In 1924 and 1925, Ford expanded into South America (Argentina), Asia (Japan), Africa (South Africa), and Australia. 

In 1929, the Ford Motor Company was contracted to set up the Gorky Automobile Plant in Russia which produced the Model A and AA. This helped to further industrialize the country. 

Key takeaways

• The Ford Motor Company’s early success was a result of Henry Ford’s mission to improve the automobile by creating a more durable and accessible version for the Average consumer. 
• For 50 years, the Ford family led the company with each new CEO bringing fresh new ideas. This led to innovation that helped Ford outpace the competition. 
• Early expansion into international markets helped accelerate Ford into an international brand with access to consumers all over the world. 

Cultural and Industry Impacts of the Ford Motor Company

The ford assembly line and manufacturing methods.

One of the most impactful reasons for Ford’s early success was the way they manufactured their vehicles. In the early years, the Ford factory produced a handful of cars each day by assigning 2-3 men to work on a car at a time. The car was built from start to finish. This was the normal manufacturing process of other car companies at the time. 

By 1913, Henry Ford created a new approach to manufacturing by introducing the first moving automobile assembly line where cars would move down the assembly line. Workers would be assigned one or two steps that they would perform over and over. This helped workers become better at their assigned tasks. Cars were produced at a much faster pace. This reduced the production time from 12.5 hours for a Model T to just 1.5 hours. With decreased production times, this new method drove down the cost making cars even more accessible for the average American. 

The moving assembly line isn’t the only manufacturing innovation that the Ford Motor Company has developed. In 1986, the Ford Motor Company introduced automated assembly for some subassembly tasks using robots. This process was initially tested in Ford’s St Louis facility and was a major success. This type of manufacturing is now used at most Ford plants today. 

Shaping the American workforce

The Ford Motor Company has a long history of embracing industry-leading policies in relation to its workforce. Henry Ford understood that in order to remain competitive and producing cutting-edge technology, the company needed to employ the best and the brightest. The monotonous and strenuous work of the moving assembly line created new problems for Ford with an increase in high turnover. 

In 1914, Ford responded by making a move that shocked the public and landed him on the front page of newspapers all over the country. The Ford Motor Company instituted a $5 workday doubling the existing rate of pay of assembly line workers. In addition, Ford reduced the workday from nine to eight hours allowing for the plant to run three equal length shifts (prior to that, the facility only ran two shifts). 

The most significant impact of this change was that the average assembly line worker at Ford could afford to purchase an automobile for their own families. The increased mobility, wages, and leisure time inspired a movement across the country. Many other companies began to follow suit giving the Ford Motor Company credit for the creation of the American middle class.

After the World Wars, the Ford Motor Company made significant efforts to employ many of the veterans who had returned home with disabilities. This move made the Ford Motor Company one of the first to hire workers with physical disabilities. At the time, most companies only hired able-bodied workers. Instead, Ford took a different approach. They not only hired these workers but created work environments that were modified to accommodate those with special needs. 

In 1941, Ford signed a contract with the UAW-CIO (United Auto Workers-Congress of Industrial Organizations) labor union. This contract helped drive better pay, benefits, and working conditions for Ford employees. 

Ford’s impact on the airline industry

Henry Ford understood that the transportation industry wouldn’t just expand on the ground. He recognized that air travel would become commonplace in the modern world. In 1925, the Ford Motor Company created its own airplane design. Between 1925 and 1933, the company manufactured and sold nearly 200 Ford Tri-Motor airplanes (nicknamed the Tin Goose). This model of plane was used by early commercial airlines in the United States. 

To help encourage further development of the industry, the Ford Motor Company provided 35 of the plane’s patents royalty-free including its navigation system (the navigational radio beam). This allowed other companies in the space to further develop aviation technology. 

Supporting the United States during the World Wars

Automobile manufacturing plants were easy to convert into facilities to produce other types of vehicles. In 1918, Ford’s River Rouge Complex began producing anti-submarine patrol boats, cars, ambulances, trucks, tractors, tanks, and airplane engines that would be supplied to Allied troops. As the war came to an end, Ford moved production back to civilian vehicles. 

Unfortunately, peace only lasted a couple of decades. As tensions began to churn again in the early 1940s, the US government began ordering jeeps from the Ford Motor Company. The word “jeep” came from the acronym “GP” which stood for “General Purpose”. 

By 1942, Ford once again halted civilian production of automobiles to support the war effort of World War II. The Ford Motor Company worked with Charles Lindberg, the infamous trans-Atlantic pilot, on the construction of more than 8,000 B-24 Liberator bombers.

In 1944, Rose Will Monroe was working as a rivet gun operator at Ford’s Willow Run facility. She was chosen to serve as the icon to promote the sale of bonds to support the war effort. Her fictional character “Rosie the Riveter” was featured on the iconic “We Can Do It!” posters all across the country. The campaign was a success and is noted as one of the most iconic images from the era.

• Ford’s creation of the first moving automobile assembly line sped up production allowing the Ford Motor Company to produce significantly more vehicles at a lower cost than their competitors. 
• The Ford Motor Company gained a competitive advantage by increasing wages, reducing hours, and improving working conditions. This helped them secure the best talent and improved employee morale and productivity. 
• The Ford Motor Company helped stimulate growth in industries that would purchase Ford products by investing in the development of new technologies. For example, Ford provided free patents to early airlines in hopes they would purchase Ford-built planes.
• Ford produced hundreds of vehicles to support the United States during World War I and II. The government contracts were not only profitable, but Ford became recognized for their support. The war also helped expose the global market to Ford-manufactured vehicles. 

Evolution of Popular Ford Models

The Ford Motor Company has had many major successes in its development of popular, cutting-edge vehicles over its nearly 120-year history. Some of these models have consistently held records for their high sales numbers and groundbreaking innovations. 

• Model T (1908) - The Model T was one of the most successful models released by Ford and demonstrated his vision to make automobile transportation accessible to the average person. Prior to the Model T, most automobiles were considered luxury items. The design was intended to drive down costs. Between 1908 and 1927, Ford sold over 15 million Model T’s. The other challenge that the Model T solved was its durability and easy maintenance. Most other automobiles at the time couldn’t handle the many miles of rough, unpaved roadways. The Model T solved for this using vanadium steel alloy for some of its parts so they would be more durable. 

• Model A (1927) - Ford continued to sell the Model T successfully for 18 years. However, other car manufactures soon caught on to Ford’s manufacturing process and started gaining market share. This pressure from other car manufacturers forced the Ford Motor Company to rethink their design of the Model T. This led to the creation of the Model A. Henry Ford assigned his son, Edsel, to take charge of developing the sleek new design. The Model A was equipped with innovative features like a Safety Glass windshield, industry-standard driver controls, and a fuel gauge. The Model A was produced around the world in plants in Argentina, Canada, Denmark, France, Germany, Italy, Japan, and the United Kingdom. Despite the economic challenges of the Great Depression, Ford sold 5 million Model A’s before it was discontinued in 1931. 

• F-Series Pickup Trucks (1948) - During World War II, the Ford Motor Company created a variety of military trucks. Ford recognized that these vehicles which were used to haul supplies to troops all over Europe had a civilian application as well. So in 1948, the company unveiled a new line of trucks. Earlier truck models were simply built on car platforms. This new line would be built on a chassis that was specially designed for heavy hauling. The original line came in eight sizes and weight ratings from the F-1 (0.5-ton capacity) up to the F-8 (3-ton capacity). This gave consumers the option to pick the right truck for their needs. The F-series naming was updated in 1953 to F-100, F-250, and F-350. These trucks remain extremely popular today. Over the last 40 years, the F-series has remained the best-selling vehicle in the United States. 
• Thunderbird (1954) - The Ford Thunderbird was introduced as a direct response to the Chevrolet Corvette. The car featured a sleek design that was very popular, but instead of focusing on power and speed like the Corvette and other European sports cars, they focused on driver comfort. This strategy paid off. Ford sold nearly 25x the number of Thunderbirds than Chevy sold Corvettes. (16,155 Thunderbirds compared to only 674 Corvettes).

• Mustang (1964) - In the 1960s, Ford Vice President, Lee Iacocca, wanted to create a new model targeted at younger drivers who wanted a sporty look but didn’t want to spend a fortune. Developed on a shoestring budget, the Ford Mustang was introduced in 1964 and quickly became an American cultural icon and was featured in movies and songs. Within a few short years, the Mustang became one of the fastest-selling vehicles in history and is still produced today. 

• Fiesta (1976) - The first internationally successful model was the Ford Fiesta. In the 1970s, the oil crisis led to a demand for fuel-efficient cars. Car manufacturers all over Europe began introducing compact model cars including the Fiat 127, Renault 5, and BMC Mini. The company spent $870 million developing the model which was the largest development budget in the company’s history at the time. In the first year of sales, the Fiesta broke the sales record that the 1965 Mustang had set. 
• Escort (1980) - The Ford Escort was originally designed as a small family car in Europe in 1968. It became widely popular especially in the United Kingdom where it was the best-selling car during the 1980s and 1990s. It wasn’t until 1980 that Ford brought the Escort to North America when the company needed a quick replacement for the Ford Pinto. The Pinto had a fuel tank design flaw that led to the death of a few hundred people and created a public relations nightmare for the company.
• Explorer (1990) - In the early 1990s, the Ford Motor Company recognized a growing interest in a new type of passenger vehicle — the Sport Utility Vehicle (SUV). They set out to design their own SUV which became the Ford Explorer. The Explorer became the catalyst for the SUV market and other manufacturers soon followed suit. By the late 1990s, SUV sales exceeded that of regular passenger cars. 

• The Ford Motor Company was able to create many popular vehicle models by paying close attention to what their competitors were doing and what their customers wanted. 
• Ford designed and introduced many variations of its models based on the local tastes and demands of each international market.

Introduction and Acquisition of New Brands

Lincoln motor company.

Lincoln Motor Company was created in 1917 as a luxury car manufacturer. The Ford Motor Company began feeling the pressure of competition from luxury brands like Cadillac and Packard. In September of 1922, Ford purchased the Lincoln Motor Company for $8 million (over $123 million today). Today, Lincoln focuses on a small number of models of luxury full-size sedans and SUVs.

The flagship automobile of Lincoln, the Continental was extremely popular throughout the history of the company. It has been reintroduced and discontinued several times, most recently from 2017 to 2020. 

In 1939, under the direction of Edsel Ford, the Ford Motor Company created the Mercury brand. This was intended to compete with General Motors who produced several mid-priced vehicles including Pontiac, Oldsmobile, and Buick. Mercury was the perfect solution to bridge the gap between the affordable Ford brand and high-end Lincoln cars. 

In 2011, after 82 years of operation, Ford announced the decision to end the production of Mercury vehicles. The company decided to put more focus on the Ford and Lincoln brands. 

The Ford Motor Company has been very successful in many of its ventures. However, the Edsel brand turned out to be a costly disaster. Created in 1956 to help the company gain market share from Chrysler and General Motors, Edsel was hyped as the “car of the future”. Despite millions of dollars poured into fancy marketing campaigns, the final product left much to be desired for the consumer. 

There were numerous complaints about the cars being unattractive and having poor quality craftsmanship. One example was the Teletouch transmission selector, which was a series of buttons placed at the center of the steering wheel to change gears. This odd placement confused drivers and was difficult to operate. In order to move the transmission from park to drive, the operator had to shift from park, to reverse, to neutral, and then drive. The transmission motor also didn’t work well on hills requiring drivers to use the parking brake instead of putting the vehicle in park. 

A scathing article published in a 1958 edition of Popular Mechanics highlighted many of the issues that drivers were reporting including poor welding, power steering failure, a leaking trunk, and a faulty odometer. 

After taking a loss of $250 million ($2.2 billion today), the Ford Motor Company chose to discontinue the brand after only three years in 1959. 

Rivian is an American electric vehicle manufacturer founded in 2009. With the rise of electric vehicles, the Ford Motor Company made a brief investment of $500 million into the brand in 2019. However, due to the COVID-19 pandemic, the company decided to terminate the contract. They have decided to maintain their relationship with Rivian for future potential partnerships, but in the meantime, have shifted those resources to the Lincoln Motors brand. 

• Ford faced many pressures from other automotive companies. They purchased and created new automotive brands like Lincoln and Mercury to give them a wider range of options for their customers.
• Not every new brand was a success. The Edsel brand cost the company millions of dollars and damaged its reputation. 

Innovations Led by The Ford Motor Company

The Ford Motor Company had a hand in creating many new products and innovations throughout its history. In addition to new technologies, Ford also played a part in the creation of new industries and historic events such as the moon landing. The Ford Motor Company created its own scientific laboratory in Dearborn, Michigan in 1951 to perform experiments and research for technology and scientific breakthroughs that could be used both inside and outside the automobile industry. 

In 1932, Ford created the first commercially successful V8 engine. This was a hit as American’s became more interested in automobiles with powerful engines. This engine is still popular today with hot rod enthusiasts. 

Early automobiles had a reputation for being unsafe. Ford recognized this and decided to put a focus on reducing automobile accidents and injuries to help change consumer perception. In 1954, the company began performing crash tests to measure the effectiveness of designs and safety features. Since then, Ford has performed more than 31,000 crash tests around the world. In recent years, Ford has begun using computer-simulated tests in tandem with physical crash tests. This has significantly improved the company’s data and insight on safety testing. 

From 1961 to 1974, Ford owned Philco, a consumer electronics company. Philco was responsible for designing, building, and equipping NASA’s mission control during the Apollo and Gemini space programs. The company also launched a series of communications satellites, many of which still provide data and telecommunications access today. 

In 1970, Ford introduced the three-point, self-adjusting lap, and shoulder seat belts into its vehicles as a standard safety feature. 

• The Ford Motor Company has spent a considerable amount of money on new technology to help it stay competitive. 
• The company wisely chose to focus on developing technology in general and not just the automobile industry. This allowed the company to expand beyond its expertise into industries like aerospace. 

Ford’s Corporate Strategy

The 21st Century has posed many challenges for the Ford Motor Company including the 2008 financial crisis and the COVID-19 pandemic, to name a few. The Ford Motor Company unveiled a new strategic plan at the end of 2020 (called “The Plan”) that will revitalize the company by modernizing how it operates, simplifying processes, and exploring new opportunities for growth. 

Electric vehicles

Ford Motor Company's strategy to embrace electric vehicles (EVs) is a core component of its commitment to achieving carbon neutrality by 2050 and aligns with the Paris Climate Agreement's goals. With an enhanced investment commitment of $22 billion through 2025, Ford is expanding its electric lineup to include not only innovative new models but also electrified versions of its iconic vehicles. This includes the Mustang Mach-E, which combines the marque's legendary performance with electric efficiency, and the F-150 Lightning, an electric iteration of America's best-selling truck, reflecting Ford's ambition to meet diverse consumer needs.

Additionally, the electric Ford Focus represents Ford's foray into the compact car segment with electric power, offering a sustainable, efficient option for city driving and daily commutes. Through these efforts, Ford is actively contributing to the global shift towards sustainable transportation, demonstrating its leadership in the automotive industry's transition to electric mobility.

Sustainability

From a sustainability standpoint, the company wants to tackle an impressive list of environmentally friendly milestones. Its mission is to contribute to 11 of the United Nations’ Sustainable Development Goals (UN SDGs). These goals include moving all manufacturing to renewable energy by the year 2035, replacing all plastic vehicle parts with 100% recycled materials, and eliminating all single-use plastics from its manufacturing process. 

Enhanced safety

The Ford Motor Company is dedicated to making its automobiles safer than ever before. With the development of new safety features and self-driving technology, the company wants to create a world that is free from vehicle accidents and workplace injuries. 

• In 2020, the Ford Motor Company unveiled a new plan to revitalize the company as the world economy comes out of the COVID-19 pandemic. 
• The strategic plan focuses on creating a sustainable line of vehicles through the development of new electric cars, trucks, and vans. 
• The company looks to meet sustainability goals set forth by the United Nations and the Paris Climate Agreement. 
• Ford also wants to place a focus on improving automotive safety.

Ford’s Impact of Racing and Motorsports

The Ford Motor Company has a long history of being a part of racing culture since its beginnings. Even before the company was founded, Henry Ford successfully reached a top speed of 20 miles per hour in his quadricycle. In the years following, Ford also won several races and set speed records with his personally designed Ford 999. 

In 1966, Ford captured the world’s attention when three Ford GT40 MK II’s crossed the finish line at the 24-hour Le Man’s race taking first, second, and third place. Not only did this make Ford the first American car manufacturer to win the title, but they also broke Ferrari’s six-year winning streak. Ford went on to take first place in 1967, 1968, and 1969. 

For over 80 years, Ford has been represented in NASCAR races. The first win came in 1949 when Jim Roper won a race in Charlotte in a Lincoln. The following year Jimmy Florian won the first race in a Ford vehicle at Dayton Speedway in Ohio. Since then, Ford-built cars have won more than 800 NASCAR races, second only to Chevrolet. 

In addition to Le Mans and NASCAR, Ford has drivers participating in many other events and races including Formula 1 and the World Rally races. 

For a car manufacturer, being able to demonstrate your vehicle’s performance on a racetrack helps to signify the brand as a well-engineered machine. The more races won in a Ford brand vehicle, the more notoriety the company receives. Key races like the 1966 win at Le Mans are a great way to capture the attention of car enthusiasts everywhere. 

• The Ford Motor Company has used racing throughout its history to demonstrate the power and quality of Ford vehicles. 
• The investment put into developing race cars like the Ford GT have helped Ford capture historic wins that provide exponentially more value from advertising and positive PR. 

Recovery from the Brink of Financial Ruin

Despite having over 100 years of success, the Ford Motor Company hit a rough patch in 2006 and was in a dismal state. The company was on track to take a loss of $17 billion due to falling sales. This forced plant closures and massive layoffs which resulted in Ford buying out 38,000 unionized workers. The Ford Motor Company needed cash but couldn’t get additional financing due to receiving a “junk” bond status. To remain solvent, the company had to mortgage its assets to raise cash. Share prices had plummeted from an all-time high of about $35 in 1999 to $8 in 2006. 

The CEO at the time was Bill Ford, the great-grandson of Henry Ford. He recognized that the company needed a new leader. In a bold move that shocked the industry, Bill Ford convinced the company board to appoint Alan Mulally as President and CEO of Ford Motor Company. Alan Mulally knew very little about the automotive industry. He began his career as an aerospace engineer at Boeing in 1969. Over his 37 years at Boeing, he rose to the position of president of Boeing Commercial Airplanes (a subsidiary of The Boeing Company). He was known for helping to save Boeing from bankruptcy after financial trouble in the late 90s and early 2000s. Bill Ford felt confident that Alan Mulally could do the same for Ford. 

Mulally quickly identified that there were some underlying issues that were resulting in Ford’s stunted performance including a lack of transparency, bad leadership, and a stagnant product line. He openly admitted to the organization that he didn’t have automotive expertise. This helped to drive a culture of more transparency within the Ford Motor Company. Rather than hiding behind inexperience, challenges, or failures, the team began speaking up when they needed help or additional support. 

Mulally also introduced a new approach to meetings. When arriving at Ford, he quickly realized that there were lots of pointless meetings where many topics and issues were discussed but resulted in no action. The normal Ford meetings were replaced with BPR (Business Plan Review) meetings in which leaders would present their 4-5 top priorities with a green, yellow, or red status. This helped the team quickly identify what areas needed the most attention. 

When Mulally announced his plan to the board of directors, he committed to focusing on four major objectives: 

• Aggressively restructure the organization to operate profitably at the current market demand.
• Accelerate the development of new products based on customer wants and needs. 
• Finance the plan and improve the balance sheet.
• Work together effectively as one team. 

The strategy was extremely successful. Not only was Mulally able to turn the company around, but they also avoided needing the taxpayer bailouts that General Motors and Chrysler needed during the 2007-2008 financial crisis. This was a huge feat and boosted public confidence in the company.

• Ford leadership was able to quickly recognize the need for a new CEO to help redirect the company in 2006 when sales began declining sharply resulting in major losses. 
• Bill Ford, the great-grandson of Henry Ford, convinced the board of directors to hire a man with no experience in the industry, Alan Mulally. He understood that experience leading an organization through tough financial times was more important than technical knowledge.
• Mulally’s success was a result of driving a culture change at Ford Motor Company that increased transparency and eliminated counterproductive attitudes and behavior. 

Final Thoughts and Key Takeaways

The Ford Motor Company is a true innovator in the automotive space. Aside from General Motors, no other car manufacturer has seen the levels of growth that Ford has achieved. Much of the success comes from the brilliant leadership of the Ford family that ran the company for over 50 years. Even through tough times, the company has found ways to grow and adapt. Their dedication to being the best helped make Ford the iconic American brand it is today.

 Recap: growth by the numbers

• The Ford Motor Company thrived under the Ford family leadership for over 50 years. Each Ford president (Henry Ford, Edsel Ford, and Henry Ford II) brought new ideas and perspectives that helped the company adapt to changes in the market and competition.
• One of Henry Ford’s greatest successes was the development and refinement of the moving assembly line process. This significantly increased productivity, improved quality, and decreased production costs.
• Few brands have shaped American culture like Ford. The Ford Motor Company is credited with the creation of the American middle class by offering competitive salaries and reduced working hours.
• Ford has created many ground-breaking and popular models including the Model T, Mustang, F-series pickup truck, and Thunderbird. They have been successful at staying ahead of most market trends and consumer demands.
• The Ford Motor Company has been able to grow by not only developing the Ford brand but also building and acquiring additional brands like Lincoln and Mercury to compete in the luxury and mid-price markets.
• Ford ramped up its international reach quickly between 1917 and 1925. Within a few short years, the company was selling cars on every continent.
• The Ford Motor Company has been an innovator both inside and outside the automotive space. They have been dedicated to many forms of scientific and technological research including automotive safety, aerospace, and clean energy.
• In 2020, the Ford Motor Company announced their new corporate strategy – The Plan. The goal is to revitalize and grow the company as it recovers from the challenges of the 21st century including the 2008 financial crisis and the COVID-19 pandemic. The Plan focuses on converting its vehicle line to electric vehicles, tackling environmental objectives, and focusing on enhancing automotive safety.
• As an automotive manufacturer, Ford has a long history of involvement in racing and motorsports around the world. It’s most famous for its wins at Le Mans in the 1960s and success in the NASCAR series. 

Naresh Sekar

The Case of Ford Motor Company: Building and Leading Teams

Ford Motor Company, one of the oldest and most storied automobile manufacturers, faced severe financial difficulties and a declining market share during the late 2000s financial crisis. Under the leadership of Alan Mulally, Ford embarked on a remarkable turnaround journey. This case study explores how Mulally implemented the “One Ford” plan, promoting teamwork, transparency, and accountability, and empowering teams to focus on core brands and improve efficiency. The outcome was a remarkable recovery, as Ford avoided bankruptcy, returned to profitability, and regained its position as a leading automaker.

Background Information

Founded by Henry Ford in 1903, Ford Motor Company revolutionized the automotive industry with the introduction of assembly line production, making automobiles affordable for the average American. Over the decades, Ford grew into a global automotive powerhouse, but by the early 2000s, the company faced significant challenges. Increased competition, rising costs, and declining market share, exacerbated by the financial crisis of 2007–2008, threatened the company’s survival.

Alan Mulally, former CEO of Boeing Commercial Airplanes, was appointed CEO of Ford in September 2006. Known for his leadership during Boeing’s turnaround, Mulally brought a fresh perspective and a track record of success to Ford at a critical time.

Detailed Timeline of Events

Early Years and the Financial Crisis (2006–2008)

• September 2006 : Alan Mulally is appointed CEO of Ford Motor Company, succeeding Bill Ford Jr., who remains as Executive Chairman.

• 2007 : Mulally begins assessing Ford’s operations, identifying inefficiencies, and setting the stage for a comprehensive turnaround plan.

• 2008 : The global financial crisis hits, leading to a severe downturn in the automotive industry. Ford faces mounting losses and declining sales.

Implementation of the “One Ford” Plan (2008–2010)

• 2008 : Mulally announces the “One Ford” plan, focusing on unifying the company’s global operations, reducing complexity, and streamlining the product lineup.

• December 2008 : Unlike General Motors and Chrysler, Ford decides not to seek a government bailout, opting instead to secure a substantial line of credit to weather the crisis.

• 2009 : Ford sells off non-core brands, including Jaguar, Land Rover, and Volvo, to focus on its core Ford and Lincoln brands. The company also invests heavily in developing fuel-efficient and technologically advanced vehicles.

• 2010 : Ford reports its first annual profit since 2005, signaling the success of the initial phases of the “One Ford” plan.

Strengthening Teamwork and Transparency (2010–2012)

• 2010 : Mulally emphasizes a culture of transparency and accountability through regular Business Plan Review (BPR) meetings, where executives openly share progress and challenges.

• 2011 : Ford continues to streamline its operations, further reducing the number of global platforms and increasing commonality across models.

• 2012 : The company launches several successful new models, including the redesigned Ford Fusion and Escape, which receive critical acclaim for their design, fuel efficiency, and technology.

Continued Growth and Market Leadership (2013–2014)

• 2013 : Ford continues to invest in innovation, particularly in hybrid and electric vehicle technology, launching models like the Ford C-Max Hybrid and the Ford Fusion Energi.

• 2014 : Alan Mulally announces his retirement, with COO Mark Fields succeeding him as CEO. Mulally leaves Ford in a much stronger financial position, with a clear strategy and a cohesive leadership team.

Analysis of Key Events

Assessing the Situation and Setting the Vision

When Alan Mulally joined Ford, he conducted a thorough assessment of the company’s operations, identifying key areas of inefficiency and setting the stage for a comprehensive turnaround. Mulally recognized the need for a clear and unified vision to guide the company through the crisis.

• Challenge : Understanding the full extent of Ford’s financial difficulties and operational inefficiencies.

• Solution : Conducting a detailed assessment and developing the “One Ford” plan, which emphasized a unified global strategy, reduced complexity, and a focus on core brands.

• Outcome : The “One Ford” plan provided a clear roadmap for the company’s turnaround, setting priorities and aligning the organization towards common goals.

Implementing the “One Ford” Plan

The “One Ford” plan was a comprehensive strategy designed to unify Ford’s global operations, streamline the product lineup, and improve efficiency. Key components included:

• Unifying Global Operations : Standardizing platforms and processes across regions to reduce complexity and leverage economies of scale.

• Focusing on Core Brands : Selling off non-core brands to concentrate resources on the Ford and Lincoln brands.

• Investing in Innovation : Developing fuel-efficient and technologically advanced vehicles to meet changing consumer preferences and regulatory requirements.

• Challenge : Implementing a comprehensive and ambitious turnaround plan during a severe economic downturn.

• Solution : Mulally secured a substantial line of credit to provide financial stability, sold non-core brands, and invested in key areas such as fuel efficiency and technology.

• Outcome : Ford avoided bankruptcy, reported its first annual profit since 2005 in 2010, and positioned itself for long-term growth.

Promoting a Culture of Transparency and Accountability

One of Mulally’s key initiatives was to foster a culture of transparency and accountability within Ford. He introduced regular Business Plan Review (BPR) meetings, where executives openly shared progress, challenges, and performance metrics.

• Challenge : Breaking down silos and improving communication and accountability within the organization.

• Solution : Implementing BPR meetings to ensure open communication, transparency, and accountability at all levels of the organization.

• Outcome : The culture of transparency and accountability helped align the organization, improve decision-making, and drive the successful implementation of the “One Ford” plan.

Strengthening Teamwork and Empowering Employees

Mulally emphasized the importance of teamwork and empowered employees to take ownership of their work. By fostering a collaborative environment, he encouraged innovation and continuous improvement.

• Challenge : Creating a cohesive and collaborative culture in a large, global organization.

• Solution : Promoting teamwork through initiatives like cross-functional teams, encouraging open communication, and recognizing employee contributions.

• Outcome : The collaborative culture fostered innovation, improved efficiency, and contributed to the overall success of the turnaround.

Investing in Innovation and Sustainability

Under Mulally’s leadership, Ford made significant investments in innovation, particularly in the areas of fuel efficiency and sustainability. The company developed new technologies and models that addressed changing consumer preferences and regulatory requirements.

• Challenge : Staying competitive in a rapidly changing market with increasing demand for fuel-efficient and environmentally friendly vehicles.

• Solution : Investing in research and development, introducing innovative models like the Ford Fusion and Escape, and focusing on hybrid and electric vehicle technology.

• Outcome : Ford’s innovative models received critical acclaim, and the company’s commitment to sustainability enhanced its brand reputation and market position.

Outcomes and Impacts

Financial Recovery and Profitability

One of the most significant outcomes of Mulally’s leadership was Ford’s financial recovery. By implementing the “One Ford” plan and making strategic investments, the company returned to profitability and strengthened its financial position.

• Profitability : Ford reported its first annual profit since 2005 in 2010 and continued to achieve strong financial results in the following years.

• Debt Reduction : The company significantly reduced its debt, enhancing its financial stability and flexibility.

Market Leadership and Competitive Position

Ford regained its competitive position in the automotive industry, becoming a leader in key areas such as fuel efficiency and innovation. The company’s focus on core brands and strategic investments paid off, resulting in increased market share and consumer trust.

• Market Share : Ford increased its market share in key segments, particularly in North America, where it became a leader in trucks and SUVs.

• Consumer Trust : The company’s commitment to quality and innovation helped restore consumer trust and loyalty.

Organizational Culture and Employee Engagement

Mulally’s emphasis on transparency, teamwork, and accountability transformed Ford’s organizational culture. Employees were empowered to take ownership of their work and contribute to the company’s success.

• Employee Engagement : The collaborative and transparent culture led to higher levels of employee engagement and satisfaction.

• Innovation and Efficiency : The focus on continuous improvement and innovation drove significant gains in efficiency and productivity.

Innovation and Sustainability

Ford’s investments in innovation and sustainability positioned the company as a leader in the development of fuel-efficient and environmentally friendly vehicles. The company’s commitment to these areas enhanced its brand reputation and competitiveness.

• Hybrid and Electric Vehicles : Ford introduced several successful hybrid and electric models, such as the Ford Fusion Hybrid and the Ford C-Max Hybrid.

• Sustainability : The company’s focus on sustainability and environmental stewardship resonated with consumers and regulatory bodies, enhancing its market position.

Lessons Learned

Importance of Unified Vision and Strategy

The success of the “One Ford” plan highlighted the importance of having a clear and unified vision and strategy. By aligning the organization around common goals, Mulally was able to drive significant improvements and achieve a successful turnaround.

• Lesson : A clear and unified vision and strategy are essential for driving organizational alignment and achieving long-term success.

Transparency and Accountability

Mulally’s emphasis on transparency and accountability was critical to Ford’s turnaround. Regular communication and open sharing of information helped build trust, improve decision-making, and drive performance.

• Lesson : Transparency and accountability are key drivers of organizational success, fostering trust, improving decision-making, and enhancing performance.

Empowerment and Teamwork

Empowering employees and promoting teamwork were central to Mulally’s leadership approach. By fostering a collaborative culture, he encouraged innovation, continuous improvement, and ownership of outcomes.

• Lesson : Empowering employees and promoting teamwork are essential for fostering innovation, continuous improvement, and organizational success.

Strategic Investment in Innovation

Ford’s investment in innovation and sustainability under Mulally’s leadership positioned the company as a leader in key areas. The focus on developing fuel-efficient and environmentally friendly vehicles enhanced Ford’s competitiveness and market position.

• Lesson : Strategic investment in innovation and sustainability is crucial for staying competitive and meeting evolving consumer and regulatory demands.

Alan Mulally’s leadership during Ford’s turnaround provides valuable insights into building and leading successful teams in a large, global organization. By implementing the “One Ford” plan, promoting transparency, teamwork, and accountability, and empowering teams to focus on quality and innovation, Mulally successfully guided Ford through a severe financial crisis and positioned the company for long-term success.

The lessons learned from Ford’s journey emphasize the importance of a unified vision and strategy, transparency and accountability, empowerment and teamwork, and strategic investment in innovation. These principles are essential for driving organizational success and navigating challenges in a rapidly changing and competitive market. As Ford continues to evolve and adapt to new market demands, these principles remain central to its enduring success and leadership in the automotive industry.

If you’re eager to expand your knowledge and enjoy a case-study-based approach, you might find the book series “ Management In Action ” interesting. Since I firmly believe that the pursuit of knowledge should never be limited by financial constraints, you can access all my content for free on my Substack account .

Ready for more?

• SUGGESTED TOPICS
• The Magazine
• Newsletters
• Managing Yourself
• Managing Teams
• Work-life Balance
• The Big Idea
• Data & Visuals
• Reading Lists
• Case Selections
• HBR Learning
• Topic Feeds
• Account Settings
• Email Preferences

How Ford Is Thinking About the Future

• Mark W. Johnson

It’s developing a portfolio of new business models.

Dealing with the uncertainty of new, disruptive business models is one of the biggest challenges that faces any large, established company. To gain insight into how to think through these obstacles, the author offers five lessons from Ford’s approach to recent advances in the mobility industry: First, be ambitious with new projects, but don’t over-invest in any one idea. Second, be sure to think not just about the physical functionality of your product, but also about the social and emotional roles it fulfills. Third, constantly examine and update your business model. Fourth, be openminded about creating new rules and metrics for your organization. Finally, to reduce risk, consider building a portfolio of new business models. While there’s no predicting the future, these strategies can position you to take advantage of new opportunities as they emerge.

Everyone’s talking about a future in which vehicles are shared rather than owned, autonomous rather than driven, and where car companies make large shares of their profits on digital “mobility services.” But if you are the Ford Motor Company and face the prospect of investing billions in new technology while your century-old business model is overturned, you might first have a few questions. How are consumers going to react to all of this? What do they really want? How can you tell which opportunities are real and which are science fiction?

• Mark W. Johnson is a cofounder and senior partner of the strategy consulting firm Innosight and author of Lead from the Future (HBR Press, 2020).

Partner Center

Site Search

Search our website to find what you’re looking for.

Select Your Language

You can select the language displayed on our website. Click the drop-down menu below and make your selection.

Past Forward

Activating the henry ford archive of innovation.

• Archive Insight
• Innovation Impact

Henry Ford: Case Study of an Innovator

Henry Ford did not invent the automobile. But more than any other single individual, he was responsible for transforming the automobile from an invention of unknown utility into an innovation that profoundly shaped the 20th century and continues to affect the 21st. Innovators change things. They take new ideas—sometimes their own, sometimes other people’s—and develop and promote those ideas until they become an accepted part of daily life. Innovation requires self-confidence, a taste for taking risks, leadership ability, and a vision of what the future should be. Henry Ford had all these characteristics, but it took him many years to develop all of them fully.

Portrait of the Innovator as a Young Man

Early Automotive Experiments: Failure and Then Success

The Automobile: A Solution in Search of a Problem

One Innovation Leads to Another

What We Have Here Is a Failure to Innovate

Detroit , Michigan , Dearborn , 20th century , 19th century , quadricycle , Model Ts , manufacturing , Henry Ford , Ford Rouge Factory Complex , Ford Motor Company , entrepreneurship , engines , engineering , cars , by Bob Casey , advertising

Sign Up For Our eNewsletters

Get the latest news from The Henry Ford. From special offers to our series of popular Enthusiasts eNewsletters, you can tailor the information you’d like us to deliver directly to your inbox.

Facebook Comments

Events & exhibits.

As a nonprofit, we need your support now more than ever. Please consider making a donation today. Your contribution is greatly appreciated.

Special Exhibits at The Henry Ford

• Detroit '67
• Bitter/Sweet
• Diego Rivera, Frida Kahlo and Edsel Ford

Sign Up for Blog Alerts

• Deutschland
• Asia, Australia & New Zealand
• Europe, Middle East & Africa
• United States & Canada
• Latinoamérica

How a century-old brand is transforming the auto industry

Before the pandemic, automakers were already facing massive disruption, including driverless cars, electric vehicles, and shared mobility. But COVID-19 dealt another blow: Automotive was one of the hardest hit sectors in 2020, especially in the U.S., where auto sales sank by 15% .

In the midst of these unprecedented challenges, however, 118-year-old Ford Motor Company leaned in and began to reinvent itself.

As the virus accelerated, dealerships were forced to close their lots and shift to servicing and selling cars online , while larger supply chain concerns caused shortages in critical parts like microchips, which slowed vehicle production.

In the midst of these unprecedented challenges, however, 118-year-old Ford Motor Company leaned in and began to reinvent itself. Under the leadership of two new executives — Jim Farley as CEO and Suzy Deering as global CMO — the company saw an opportunity for business transformation and started mapping out a strategy.

Questioning everything, from its organizational structure to its customer experience, Ford made difficult decisions to put technology at the center of its business and get ahead of auto consumers’ evolving needs.

While still in the early stages of its journey, Ford has developed something of a blueprint for auto brands of the future. Recently, I spoke to Farley and Deering about the company’s transformation strategy. They shared three key changes they’re focused on.

1. Reimagining what auto brands do

Business transformation has been a buzzword for decades, but for years, it wasn’t an urgent reality for Ford. Then along came the pandemic, and its significance accelerated.

We have to invest in electric architectures and build software know-how in the company. And we need to integrate that know-how in ways we’ve never had to before.

“Events of 2020 made it clear that modernization is required to be a sustainable company,” explains Farley. A critical factor to modernizing has been disrupting its organizational model to aid the shift toward vehicle electrification and other digitally connected products. Since consumers expect more safety and convenience from automakers, the future of the auto industry will increasingly exist outside the doors of the vehicle.

According to Farley, this has required Ford to “unglue” its organization to allow for a new way of being. “The biggest transformation for us is to a software services–dominated company and brand,” he explains. “We have to invest in electric architectures and build software know-how in the company. And we need to integrate that know-how in ways we’ve never had to before.”

Such a fundamental pivot, Deering acknowledges, impacts company culture. “We have to make sure that we bring people along with us, and at the same time, give them the space to fail. There is strength in knowing that change is not going to be easy, but we’re going to do it together, and we’re going to look forward.”

2. Driving the connected car experience forward

By committing to look forward, the automaker is building on Henry Ford’s original vision — that every American consumer can own a vehicle — by reimagining what vehicle ownership looks like. Through software and other technology, Ford is working to ensure that it’s a fully connected, always-on experience.

When we have the ability to update our products dynamically with software, the customer relationship is no longer episodic. It’s every day.

“For so long, cars have really been isolated from the rest of people’s lives. We can change that by making them digital products,” Farley explains. To facilitate this shift, Ford has tapped into strategic partners like Google and is integrating software into its vehicles. Beginning in 2023, for example, millions of Ford and Lincoln models will be powered by the Android operating system, with Google apps and services built in.

Beyond offering drivers more assistance and convenience, connected vehicles also give Ford the ability to deepen its customer relationships. “When we have the ability to update our products dynamically with software, the customer relationship is no longer episodic. It’s every day,” says Farley.

3. Transforming the customer relationship model

To deliver on its vision of an always-on customer experience, Ford is also evolving how it approaches relationship-building. While many automakers stick to a traditional acquisition model to attract consumers through ads and rebates, Ford is bringing customer relationships to the forefront by shifting to a loyalty-based model.

“Another big transition for us as a company — and an industry — is to stop being obsessed with conquest and start putting all of our resources into taking care of the customers who already love the brand and own the product,” Farley explains. “This is a model that is available because of the always-on nature of digital. Our products and services are now integrated.”

We want to know our customers well enough to meet their needs while they’re in the vehicle, while they’re outside the vehicle, and before they even think about buying a vehicle.

Gearing marketing efforts to meet people’s ongoing needs in a more personalized way is critical to Ford’s loyalty-based push, because, as Deering points out, “The customer expects us to know them.”

For Deering and her team, this means relying more than ever on first-party data and signals to create an ecosystem that nurtures deeper relationships. “We want to know our customers well enough to meet their needs while they’re in the vehicle, while they’re outside the vehicle, and before they even think about buying a vehicle from us,” she explains.

While Deering and Farley both readily admit that Ford’s business transformation is a yearslong journey, they’re committed to playing the long game and continuing to drive brand love and loyalty through the 21st century.

Others are viewing

Marketers who view this are also viewing

How Carvana reimagined the automotive customer experience

How kia is boosting business by focusing on first-party data, the car-buying process: one consumer's 900+ digital interactions, how jaguar land rover generates high-quality leads in today’s omnichannel auto experience, as people resume planning for life’s big moments, brands have a role to play, it’s time to electrify auto marketing, thomais zaremba, others are viewing looking for something else, complete login.

To explore this content and receive communications from Google, please sign in with an existing Google account.

You're visiting our United States & Canada website.

Based on your location, we recommend you check out this version of the page instead:

🔥 Enroll in the Blue Ocean Strategy Practitioner Program 🚀   Secure your spot now!

THE FORD MODEL T

Ford’s Model T, introduced in 1908, is a classic example of a market-creating blue ocean strategic move that challenged the conventions of the automotive industry in the United States. It made the automobile accessible to the mass of the market.

Until that time, America’s five hundred automakers built custom-made novelty automobiles. Despite the number of automakers, the industry was small and unattractive with cars unreliable and expensive, costing around $1,500, twice the average annual family income. But Ford changed all of that with the Model T.

He called it the car ‘for the great multitude, constructed of the best materials.’ Although it only came in one color (black) and one model, the Model T was reliable, durable, and easy to fix. And it was priced so that the majority of Americans could afford one. In 1908 the first Model T cost $850, half the price of existing automobiles. In 1909 it dropped to $609, by 1924 it was down to $240. A 1909 sales brochure proclaimed, ‘Watch the Ford Go By, High Priced Quality in a Low Priced Car.’

Ford’s success was underpinned by a profitable business model. By keeping the cars highly standardized and offering limited options and interchangeable parts, Ford’s revolutionary assembly line replaced skilled craftsmen with ordinary unskilled laborers who worked one small task faster and more efficiently, cutting the labor hours by 60 percent. With lower costs, Ford was able to charge a price that was accessible to the mass market.

Sales of the Model T exploded. Ford’s market share surged from 9 percent in 1908 to 61 percent in 1921. So great was the blue ocean Ford created that the Model T replaced the horse-drawn carriage as the primary means of transport in the United States.

This automotive industry case study highlights the common pattern underlying successful blue ocean strategic moves:   Value Innovation . It’s the simultaneous pursuit of differentiation and low cost that allows companies to unlock new demand and create blue oceans of uncontested market space.

THE BLUE OCEAN ONLINE COURSE UPDATED

Learn the essentials of blue ocean strategy and shift created by #1 Management Thinkers in the World.

For anyone tired of competing head-to-head and wanting to seize new growth.

Average user rating

The blue ocean strategy practitioner program.

Transform your strategic perspective, master blue ocean tools and frameworks, & learn to unlock new growth opportunities

Get started with new market creation with our live, interactive, expert-led program.

ENROLL TODAY

• About / Contact
• Privacy Policy
• Alphabetical List of Companies
• Business Analysis Topics

Ford Operations Management: 10 Decision Areas, Productivity

Ford Motor Company’s operations management (OM) optimizes the organizational processes of the multinational automotive business. Under the One Ford plan of former CEO Alan Mulally, the company’s operations management became more effective in addressing the 10 strategic decision areas. As one of the biggest firms in the global automotive industry, Ford maintains operations management strategies that deal with a variety of business conditions based on different market contexts. As such, in the 10 strategic decisions of operations management, Ford must ensure flexibility along with consistency throughout its global organization.

Ford applies the 10 strategic decisions of operations management with emphasis on consistency and high productivity. The company also maintains a considerable degree of flexibility to address business and automotive market variations in different areas around the world. Through high productivity and efficiency, operations management helps address the tough competition illustrated in the Five Forces analysis of Ford . Competitive forces involve other automakers, such as Toyota , General Motors , Tesla , BMW , and Nissan.

Ford’s Operations Management, 10 Critical Decision Areas

1. Design of Goods and Services . The company’s goal in this strategic decision area of operations management is to achieve global consistency. Ford’s mission statement and vision statement require such consistency in goods and services. This condition contributes to the car manufacturer’s financial effectiveness and its ability to optimize customer satisfaction. Also, decisions in this area of operations management are based on Ford’s generic competitive strategy and intensive growth strategies , which give importance to product innovation. The company’s automobiles, accessories, and financing services are designed to be differentiated from competing products in the international automotive market.

2. Quality Management . The main concern in this strategic decision area of operations management is the satisfaction of quality expectations. Ford Motor Company does so through standard quality assurance practices. The firm also conducts random batch tests on its products to ensure quality. Quality evaluation also involves data that the company acquires through market research to identify customers’ quality expectations about automobiles and related services. Ford’s company culture (work culture) maintains a mindset of quality in human resources, in support of the quality standards and measures in this area of operations management.

3. Process and Capacity Design . This strategic decision area of operations management supports production goals. Ford pioneered the assembly line method, which maximizes production capacity. Also, the automaker continues to improve its capacity by developing new facilities for its production network and supply chain. The high efficiency and high productivity of business processes are among the main factors that reinforce the business strengths and competitive advantages noted in the SWOT analysis of Ford Motor Company . With support from decisions in this area of operations management, such strengths enable the company to withstand the aggressiveness of other large multinational automakers.

4. Location Strategy . Ford Motor Company’s aim in this strategic decision area of operations management is to ensure the strategic benefits of its facility locations. The company’s strategy involves regional production facilities, such as car factories in Germany. On the other hand, dealership locations are based on market size and proximity to target buyers. Ford’s marketing mix (4Ps) relates to this area of operations management, in terms of selecting locations for maximum market reach and vehicle sales.

5. Layout Design and Strategy . In this strategic decision area of operations management, the objective is to maximize the productivity and efficiency of workflows and resources. Ford addresses this objective through automation of production processes, such as through the use of robotics in production facilities.

6. Job Design and Human Resources . Ford has the goal of maximizing human resource effectiveness and efficiency in this strategic decision area of operations management. Ford’s corporate social responsibility (CSR), ESG, and stakeholder management programs support HR capacity and employee satisfaction. The company ensures continuous improvement and personnel development in its strategies. The teams and divisions in Ford’s company structure (business structure) determine the factors influencing operations managers’ critical decisions for optimizing workforce productivity.

7. Supply Chain Management . This strategic decision area of operations management focuses on streamlining and cost-effectiveness in the supply chain. Ford’s supply chain is global and involves company-owned production facilities, as well as third parties. The company-owned facilities, such as those in the Ford River Rouge Complex in Michigan, are a result of the company’s backward vertical integration strategy. This strategy empowers Ford to control the supply of some of the materials used for manufacturing its vehicles. However, the trends, opportunities, and threats noted in the PESTLE/PESTEL analysis of Ford affect such operational control and the operating condition and productivity of the supply chain.

8. Inventory Management . Ford’s inventory management supports just-in-time manufacturing methods, which require continuous monitoring to adjust the inventory and minimize its costs. However, in this strategic decision area of operations management, Ford’s actual inventory management performance also points to market-based inventory decisions. Different markets present different challenges, and the automotive company applies different inventory management practices to suit relevant market variations.

9. Scheduling . In this strategic decision area of operations management, the short-term and intermediate schedules of processes and resources are considered. Ford addresses these concerns through automated scheduling in its production facilities, and semi-automated scheduling in its offices, such as corporate offices and regional offices.

10. Maintenance . The goal in this strategic decision area of operations management is to maintain adequate business processes to satisfy demand. Ford addresses this goal through a combination of strategies for HR, IT, manufacturing and other areas, as well as maintenance teams for facilities and other assets.

Productivity at Ford Motor Company

Ford Motor Company’s operations management addresses productivity goals for the 10 strategic decision areas. Since the firm has various operations and products, a wide array of productivity measures is used. Some of Ford’s productivity metrics are as follows:

• Number of service jobs completed per day (after-sales service productivity)
• Number of vehicles rolled out per day (manufacturing productivity)
• Number of applications processed per day (Ford Motor Credit Company productivity)
• Chen, X., Deng, T., Shen, Z. J. M., & Yu, Y. (2023). Mind the gap between research and practice in operations management. IISE Transactions, 55 (1), 32-42.
• Ford Motor Company – Form 10-K .
• Ford Motor Company – Locations .
• Ford Motor Company – Responsible Material Sourcing .
• U.S. Department of Commerce – International Trade Administration – Automotive Industry .
• Venkatesh, V., Raman, R., & Cruz-Jesus, F. (2024). AI and emerging technology adoption: A research agenda for operations management. International Journal of Production Research, 62 (15), 5367-5377.
• Copyright by Panmore Institute - All rights reserved.
• This article may not be reproduced, distributed, or mirrored without written permission from Panmore Institute and its author/s.
• Educators, Researchers, and Students: You are permitted to quote or paraphrase parts of this article (not the entire article) for educational or research purposes, as long as the article is properly cited and referenced together with its URL/link.

2024 Case Study Competition

Page and the  Institute for Public Relations  conduct an annual competition for the writing of original case studies by students enrolled in a school of business, communication or journalism and who are pursuing a degree that is focused on corporate communications and the practice of public relations. The objectives of the competition are to introduce the practical applications of the core principles that define public relations as a critical function of management to scholars, teachers, and students, and encourage research that contributes to the profession's body of knowledge and provides practical suggestions on how to improve the corporate public relations function.  The 2024 Case Study Competition is now open for entries,  a pply here . The deadline to apply is Friday, January 15, 2024 at 11:59 p.m. ET. 

Student authors of winning entries and their faculty advisors are awarded cash prizes and recognized by the nation's leading corporate communications executives. See below for 2023 winning cases. 

2023 Case Study Competition Results:

First place | trouble in paradise: the walt disney company.

• Accommodation : JACK KOTEN PAGE PRINCIPLES CASE STUDY AWARD
• Submitted by : Ayesha Djibo, Mya Estrada, Breahn Fisher, and Kelly Weinstock 
• School : Texas Christian University  
• Advisor : Dr. Liang Ma
• Download :  Presentation |  Case Study

SECOND PLACE | The Starbucks Union Boom: Pro-Worker Employer to Union Target Case Study Competition

• Submitted by : Yasmeen Jabara, Nicolas Blanco Ballesteros, Meagan Keefe, and Gabriela Perez 
• School : American University  
• Advisor : Pallavi Kumar
• Download :  Presentation  |  Case Study

THIRD PLACE | The US Army Recruiting Crisis: Cause and Potential Solutions

• Submitted by : Blake Bonifas 
• School : University of North Carolina at Chapel Hill 
• Advisor : Dr. Lois Boynton 
• Download :  Presentation  |  Case Stud y

Honorable Mentions:

Communications | more than a penny for your thoughts: paypal’s inconsistent acceptable use policy.

• Submitted by : Darian Hernandez, Carolina Gnerre, and Taimarie Carasa 
• School : University of Florida 
• Advisor : Patrick Ford
• Download :  Presentation  | Case Study

BUSINESS AND INTERNATIONAL | Not Your Average Joe: How Spotify Experienced The Extraordinary Joe

• Submitted by : Riko Setsuta, Kenny Anthony 
• School : Peking University  
• Advisor : Soojin Roh

Hot Threads

• Spare Parts
• Buy Accessories
• KOGO Hotels
• Classifieds

Rise & fall of Ford India: A comprehensive study!

Ford has tasted success as well as failures with different products, here in India. What Ford India failed to achieve, was, sustainability.

BHPian pqr recently shared this with other enthusiasts.

Note: The study takes into account data collected from the most trusted sources like the Society of Indian Automobile Manufacturers library, news reports filed by reputed publication houses, innumerable interactions with industry experts, among other reliable sources. However, the findings put forth to members of the Team BHP here, like any other study, is susceptible to error. In such a scenario, please feel free to correct the author with a polite comment or message. It’ll likewise be suitably addressed, and sincerely appreciated. Thank you, and wish you a joyous reading!

On 9th September 2021, Ford has announced its exit from India. With more than 25 years of existence in India, Ford has sold over 12 lakhs passenger vehicles here. Ford’s compatriot General Motors, has sold around 8.8 lakhs cars in India, under two different brands – first Opel and later Chevrolet, before leaving the Indian market in 2017. Contrasting to this, East Asian automotive companies have found a better foothold in the Indian market, which Europeans are also struggling to achieve.

Entering later than Ford, in the post economic liberalization era, Hyundai has sold 5 times more cars in India till date, and reached to 17% market share pinnacle of the Indian passenger vehicle (PV) industry. The Korean brand has even dwarfed the sales bar of Japanese global automotive giants (Toyota and Honda) in India.

Ford has tasted success as well as failures with different products, here in India. In due course of existence, it has touched the highest PV market share of 4%, on the back of the success of generation-1 Figo (primarily diesel version). What Ford India failed to achieve, was, sustainability, thereafter.

At any given point in time, only one car in Ford’s Indian portfolio did all the heavy lifting and supported 50%+ volume. Other products were either not so successful or worse – nonexistent in the portfolio. In early years, its portfolio was dominated by mid-size sedans, namely Ikon and then Fiesta Gen-1, followed by Figo Gen-1 hatchback, and now Ecosport, since its 2013 launch.

So, in long run, Ford India has always remained one car wonder, with Endeavour as icing on the cake. To achieve sustainable market share, automakers need to have a successful product portfolio, continuously updated in line with the latest market trend, and with a staggered product-life-cycle (PLC) curve. This helps companies to maintain healthy cash flow, and fend off their territory from the competition. It’s not that Ford India didn’t try, they tried very late and missteps took a toll on the whole company.

Ecosport has remained the most successful product in Ford India’s portfolio, followed by Figo gen-1 and Fiesta gen-1. Ikon, too, can be considered iconic, of course, in its own right. Profit loaded Endeavour helped to lend slight premium brand imagery to Ford in India.

Then there were massive flops like – Fiesta gen-2, Fusion and Mondeo, in respective segments. But the real products which actually doomed hell, for Ford in India, were - Figo gen-2 and Aspire (a product tailor-made to fit into the unique taxation policy India has for sub 4m passenger vehicles). The strategic direction was fine, but at times, the execution was not so good.

Ford India Corporate Strategy – shifting gears

1995 - JV route

Ford has started its Indian journey by signing a 50-50 joint-venture (JV) partnership with Mahindra (Mahindra Ford India Ltd) in the mid 90s. Then Ford was the second largest automotive company in the world. Modified European Escort, launched in late 1996, was the first offering of JV in India. It used to come to India in completely-knocked-down (CKD) form, and later was assembled at Mahindra’s Nashik plant. JV and CKD operation was presumed as a low risk way to enter and explore the newly opened Indian market, post liberalization of the economy in the early 90s.

1998 - Export oriented manufacturing plant

By March 1998, Ford took its ownership to 72%, renamed the company Ford India Private Limited and later increased its holding further. As a next strategical step, Ford decided to set up a new plant in Maraimalai Nagar in Chengalpet district, 35 km from Madras (now Chennai), with a 1 lakh annual production capacity and future expansion possibility of up to 2,50,000 units. The first car to roll out from the plant was Ikon. Ikon was based on the European Fiesta mark IV hatchback, designed and engineered in Germany and the United Kingdom, especially for India. Initial localization was 70%, in phase manner it was taken up to 90%. Ford India has also started exporting CKD kits of Ikon to South Africa, Brazil and Mexico without engines, because, initially, 1.8L diesel engine, 1.3L and 1.6L petrol engines were imported from Britain, South Africa and Spain, respectively.

And by 2002, 65% of passenger vehicle export from India was comprised of Ford Ikon. The export oriented plant has deleveraged risk of product’s performance in the local market to a certain extent and increased cost synergy by economies of scale. Several other manufacturers have also used export lead plant template to start their Indian manufacturing journey e.g. Hyundai-KIA, GM, Nissan-Renault alliance and Volkswagen.

Localization was an important lever for Ford or for any automaker in India, to keep cost in check due to import duty structure and development of foreign exchange (could be adverse as in today’s date). This is why from 2002 they started sourcing petrol engines and transmission from Hindustan Motors Halol based plant, located in Gujarat.

With the success of Ikon, Ford continued with this strategy of picking European car and reengineering in small R&D set-ups in Europe and launching it in India. On similar lines, Fiesta Gen-1 was the next breakthrough for Ford in India. Though, diesel engine and gearbox were imported and petrol engines were assembled by Hindustan motors for Fiesta Gen-1 at Halol plant.

Meanwhile, in 2001, Ford also launched the made-in-Belgium Mondeo, which was a flop, due to its high price. 2004 witnessed two new launches from Ford India - global Everest (called as Endeavour in India), a true blue SUV and Fusion (first crossover), was brought in through CKD route, while former was super hit (then), and later was a massive flop, as it was too expensive.

In 2005, Mahindra sold its remaining stake in the company to completely end the partnership. As per media reports - Mahindra got a lot of insights, and learnt the best global practices in manufacturing, which is later used in developing Scorpio, in fact, in 2002 Scorpio has certain parts borrowed from Ford Escort’s parts bin. In turn, Ford learned about the Indian market, to expand its dealership network.

2009 - High volume game

Without a hatchback in the portfolio, Ford’s presence was limited to 35% of the total Indian PV market size, then. With the turn of the decade, Toyota (with Etios twins) and Honda (with Brio and Amaze) too has had similar plans. Tried and tested strategy came to rescue – European Fiesta mark V platform was re-used to build Indian Figo gen-1. 1.4L TDCi diesel engine won the heart of Indian buyers again. Over 80% of Figo gen-1 sold were with a diesel heart. Suddenly Ford’s volume jumped multi fold, due to competitive pricing, but the poor petrol engine was a laggard and limited its overall volume potential. Though 2013 facelift failed to bring sustainability to the nameplate, and volumes dipped thereon.

2011 ‘One Ford’ strategy in India

2011 saw the launch of all new Fiesta gen-2 (India), the outcome of much famed strategic direction from Ford’s then global CEO Alan Mulally. The intent was to produce global products with very high backend cost synergy and sell in multiple markets across the globe.

India specific Fiesta gen-1 was relegated and rebranded as ‘Classic’. Guess what, Fiesta gen-2 was a sales disaster. Mere 8,300 copies could find a home with Indian families.

But all was not bad with the ‘One Ford’ strategy. As a next product - Ecosport developed in Brazil, for global markets, has actually kick started an all new segment in India – sub 4m monocoque crossover (SUV). Wait, not really, the first sub 4m crossover, which has gone unnoticed, was Rio (rebadged Chinese Zotye T200) from Premier Auto Limited (PAL), launched in 2009. It was assembled at PAL’s Pune plant from imported CKD kits produced in China.

Deep localization and all new manufacturing plant

To gain a strong foothold in the Indian market, Ford decided to go for deep localization in 2011 and benchmarked, market leader Maruti’s most profitable products – Swift and Dzire. For that, Ford has built an all new plant in Sanand Gujarat, with an annual capacity of 2,40,000 units, and an overall investment of a billion dollar. The plant was meant to serve as a hub for global compact car manufacturing. Well, product performance results came out in 2015, which were so disastrous, that Ford has to wrap up its whole operation in India by 2021. More on that later.

2016 – Scouting for local partner

With the dismal performance of Aspire and Figo Gen-2 (developed under ‘One Ford’ umbrella in Brazil and deeply localized in India) by the end of 2016, Ford realized that its whole billion dollar investment in compact product development and the new plant has turned into bad assets. Solo it could not go anywhere by putting good money behind bad, and started to look out for a partner who could lend a shoulder to carry on their baggage. And they found an old friend who was also struggling with a slew of product failures (KUV100, TUV300, Marazzo, Alturas). Theoretically, it was a move to share future product development risk in form of a joint venture. The deal was struck by mid-2017 and both have started working on a new arrangement of cooperation.

The deal has manifested in a new structure of ownership, where Mahindra will take 51% control, and Ford will own the rest. Mahindra’s platform was supposed to underpin three new SUV’s for Ford in India. The new entity was supposed to be operational by mid-2020.

After a new succession plan was drawn at Mahindra in 2020, there was a change in leadership in 2021. CFO becoming CEO of Mahindra and Mahindra seems like a clear indication of what key focus is for Mahindra now – sustainable long term profitability. CFO by nature has to be prudent, and prudence lies in not owning an ailing asset without any foreseeable redemption – in this case, it seems it was Ford’s India operation, and in general, multiple times bankrupt SsangYong from Korea.

2021 – Ford’s Indian market exit strategy

To say goodbye is pretty easy and simple on paper. And Ford did it in

September 2021, after the fallout of the Mahindra deal, early in 2021. In general, it seems the public is a little less shocked, as they witnessed a similar spectre in 2017, General Motors (Chevrolet brand) redux.

Body style & segment share analysis

Escort (1996-2000)

Escort was the first offering of JV in India with the option of a petrol or a diesel engine. A mid-size sedan by today’s standard, but back then, it was considered a premium sedan by many (₹ 7,30,000 price), as many Indian’s weren’t that wealthy in just liberalized economy and millennials were teens or babies. Then it was competing against the likes of Opel Astra, Daewoo Cielo and later with Honda City and Mitsubishi Lancer. Escort’s CKD kits were assembled at Mahindra’s Nashik plant. Ford has modified European Escort’s air conditioner, suspension setup and raised ground clearance to suit Indian road conditions. Engines were also modified to deliver higher efficiency and suit bad fuel quality in India. Escort received a tepid response back then as Indian customers were sensitive to pricing and fuel economy. Still, Escort gained 6% of sedan market share at a given point of time, but then it was Ford’s guinea pig to test Indian waters.

Ikon (1999-2003-2008-2010)

Ikon was the second product of Ford in India, was smaller than Escort and came at an entry price of ₹ 4,99,677. The company claimed that 70% of its content were localized at the time of launch. It was designed and engineered in Germany and the United Kingdom but built in India, to compete against Maruti Esteem and Fiat Sienna then. Came with Endura 1.3L, Rocam 1.6L petrol and Endura 1.8L diesel engine, which were Euro II compliant, all were imported till 2002. The marketing campaign was quite exciting, as they came up with the hinglish tagline ‘Josh machine’. And Ikon did deliver that josh to Indians by taking Ford India’s sedan segment market share to the highest ever level of 18% in 2000 and became the second best-selling sedan in the country after Hindustan Motors - Ambassador. It continued to hold 2nd position till 2002, just behind Hyundai’s Accent, before Tata’s budget sedan Indigo took over pole position in 2003.

In 2003, Ford has launched a facelift of Ikon with a new 1.3 Rocam engine with a lower price tag. Ford has started sourcing petrol engines and transmission locally, from now defunct Hindustan Motors. This helped ford to sell the highest number of Ikons in a single year (2004), and maintained 3rd position in the overall sedan segment till 2004. In 2005, it handed over the baton to Fiesta nameplate, and continued to sell alongside Fiesta gen-1, thus both together covering a wider price spectrum.

In 2008, Ford launched facelift-2 with a new 1.4 TDCi diesel engine from Fiesta gen-1. Diesel did small magic, sales crossed the 12,000 mark, towards the fag end of PLC. In fact, Ikon did enjoy quite a long PLC of 10 years, as Ford India kept on altering variants and repositioning of Ikon throughout the lifecycle.

Mondeo (2001-2005)

The new millennium in India started with new found wealth, and to capitalize on the same, automakers started bringing in premium sedans to India from their global portfolio. Two possible routes were adopted – CKD with some localization or completely-build-unit (CBU). Ford brought in made in Belgium CBU Mondeo with both petrol and diesel engine option to India. To suit Indian driving conditions Ford has adapted suspension set up from the Mondeo sold to Norwegian police where cars sometimes have to travel on unpaved surfaces. Well, Honda was quite successful with petrol only CKD assembled Accord. Mondeo bombed on the sales chart. Ford has had out-priced CBU Mondeo in the segment. It was not alone, Opel’s CBU Vectra met an even worse fate.

Fiesta gen-1 (2005-2008-2011-2014)

Though Ikon was based on European Fiesta hatchback but never worn that nameplate. So as the time came to introduce Ikon’s successor (next generation), Ford decided to use Fiesta nameplate in India. Ikon’s template was used and parts were borrowed from Fusion launched by Ford in 2004. A major change was the 1.4 TDCi diesel engine engineered and developed in Australia. It was a gem of an engine, fuel efficiency was brilliant. Indians lapped for the diesel powered version and it used to command over 85% of total sales. Fiesta started its journey at 3rd position in the entire sedan segment, just behind Honda City (2nd gen) and Tata Indigo.

By 2008, facelift came, surprisingly sales settled around 15,000 units thereafter. By then, it seems Maruti Swift Dzire (length 4.16m) launched in 2008 took the diesel customer away with its attractive price range of ₹ 5.4 lakhs- ₹6.7 lakhs, as Fiesta’s diesel range started at ₹ 7.2 lakhs. Though they were in a slightly different league within the sedan segment, the value proposition of Swift Dzire diesel (Fiat sourced engine) was very enticing, and Fiesta’s cabin was not very spacious either. What Fiesta’s PLC curve suggests, is that Ford wasn’t that good with managing mid-life of product, or was it too much lethargy and complacency.

Fiesta gen-2 (2011-2014-2015)

Dead on arrival - short lifecycle, short story.

Well, it came out of Ford’s global one product strategy, with a new set of competitive 1.5L Ti-VCT petrol and 1.5L TDCi diesel engines. Ford India has out priced it. Lack of space at the back compared to entrenched rival, what this segment of buyers keenly look for, was missing, and bland rear end styling too didn’t go too well with potential Indian customers. So it failed miserably and how. Re-positioned facelift came in 2014, only with diesel engine, and failed miserably again.

By the way, it was the first Ford product in India to wear Aston Martin’s front grill design, by virtue of Ford owning Aston Martin till 2007.

Figo Aspire (2015-2018-2021)

Indian sub-4m sedan segment is very unique in the world due to all new tax system introduced in 2006, and then manufacturers also started getting innovative, to fit in the right product, and take advantage of lower tax rate and fulfill the emotional need of sedan buying customers in India.

Tata was the original innovator, they bought a chainsaw and chopped off the boot of Indigo sedan (Indica hatchback based sedan) and sold it by the name of Indigo CS (compact sedan), and it did wonder. Maruti could not take advantage then, as they already launched 4.16m long Swift Dzire with 1.3L naturally aspirated petrol engine in 2008, by sticking an abnormal boot to the Swift hatchback, here solution was glue stick and not a gruesome chainsaw. But then they continued with glue stick solution when Swift second generation was introduced in 2011, this time they were having a car that fits into length criteria of sub4m, by design and not by default of course, as well as engine criteria of 1200cc, and results were remarkable since 2012. Maruti Dzire has always been ‘the sub4m segment sedan’ – commanding over 55%+ sub segment share at any given point of time. Uniquely, the hatchback body style of each brand was donor product for all sub 4m sedan products.

It is not that Honda (with Amaze) and later Hyundai (with Xcent) tried to dislodge Dzire, perched at the top rung of sub 4m sedan segment, ever since its entry. Dislodging Dzire has never happened, but then they emerged as a strong challenger and garnered respectable segment share.

Ford India wanted to crack open the lucrative sub 4m sedan segment, with an all new strategic direction - When in Rome (India), do as the Romans (Maruti) do. Though Aspire was based on Ford Ka (Figo gen-2 in India) developed in Brazil under one Ford strategy. That has manifested in a competitively priced tin can contraption, which scored 3 stars in GNCAP frontal offset crash test and was found with body shell integrity - UNSTABLE.

Wait a minute, this is not how Ford used to make cars in India since its entry, nor the reason why Indians bought Ford cars. A segment of Indian customers bought Ford’s car - for perceived strong build quality, balanced ride and handling nature, and juicy diesel. For fuel efficient tin cans, they always have had, relatively unsafe, but reliable – Japanese and Koreans. It seems that Ford’s original DNA was severely compromised, and a loyal customer base shunned Ford’s sub 4m sedan. With an all new value proposition, Aspire was not able to even challenge Tata’s Zest or Tigor and was relegated to the bottom rung of sub 4m sedan segment, to rot and die. And thereby flaming the entire, much touted, billion dollar investment in all new plant and product development. However, detuned 1.5 TDCi diesel engine from Ecosport was best in the segment, and worthy to mention that it was also having a 1.5L petrol engine with dual clutch transmission as an option at the time of launch, but when it comes to overall performance, the experience was spoil by the lackluster body, and 1.2L naturally aspirated petrol engine was lame at the best. Ironically, it came with segment first 6 airbags for the top end version.

Even the 2018 facelift was hammered down by third gen Dzire, with all new A pillar design (finally to differentiate from Swift), and later by global Honda Accord inspired second gen Honda Amaze.

Ford Fusion (2004-2007-2009)

As the name suggests, it was a fusion of oversized hatchback with the versatility of MUV like space, as Ford claimed, and semi SUV styling, as media told their audience. For the Indian audience, it was just con‘fusion’. Priced at ₹ 6,20,000 ex-showroom Delhi, with only 1.6L naturally aspirated petrol engine at the time of launch, was way above Hyundai Getz’s price tag of ₹ 5,40,000 for top end variant, and somehow reached in executive sedan price territory. That made it instant flop! Ford’s expectation was to sell in the range of 6,000 to 12,000 units a year. But it lasted with marginally less than 10,000 units sales in its entire lifespan.

2007 sales bump was due to the introduction of a re-positioned facelift with a 1.4L TDCi diesel engine borrowed from Fiesta Gen-1. But it failed again, and Ford has to discontinue it in 2009. Some say it was way ahead of its time, but in reality, its price was way too ahead of the competition. Don’t believe in the reasoning of price theory, then recall the introductory price of 1.5L naturally aspirated petrol Ecosport in 2013 – ₹ 5,59,000!

So in summary - when people first saw Fusion they thought - “It's a Bird... It's a Plane... It's Superman”, in this case, it turns out to be err… Superflop!

Hatchback segment

Figo Gen-1 (2010-2013-2015)

Till 2009 Ford was not fully mainstream in India, as it used to sell sedan and premium SUV only, and its participation was limited to 35% of the Indian PV market then. So finally Ford took that plunge by 2010, in a highly competitive and relatively low margin hatchback segment with Figo gen-1. It was based on global Fiesta hatchback Mark V, and in the interest of cost synergy, parts were drawn from the then Fiesta gen-1 parts bin. With huge cost synergy, it was launched at a very competitive price point. Similar to Fiesta it was having a highly fuel efficient 1.4 TDCi diesel engine and a lame 1.2L naturally aspirated petrol engine, but it was carrying traditional virtue of Ford’s in India - strong build quality, balanced ride and handling, and juicy diesel. 1.4L TDCi diesel engine was an immediate hit, and Ford was selling more than 74,000 copies a year by 2011 and the PV market share of Ford India reached an all-time high level of 4%.

As far as build quality is concerned, though it was awarded 0 Star in GNCAP rating in 2014 - without any airbags, still, the body shell integrity was found to be stable, just like VW’s Polo hatchback. Cars with 0 Star rating usually score a 0 point, but in the case of both, Polo (5.42) and Figo (2.63), there was a score above 0. What it means is that – if Figo gen-1 have had twin front airbags in the base variant, it would have fared quite well in the frontal offset (40%) crash test at 64 kmph.

Facelift came in 2013, but by then Hyundai too launched Grand i10, as the name suggests, it was a grand version of i10. With all fresh entry, Grand i10 took the shine away from Figo, as later was looking aged even with the facelift. Sales dropped drastically for the next two years in succession. So it became a typical Ford way of goofing up with mid-life product management for the second time.

Figo Gen-2 [B562 project] (2015-2019-2021)

To rebuild Figo gen-1’s initial success, Ford has gone for deep localization by bench-marking Maruti’s ever successful Swift hatchback. Again it was based on Ford Brazil’s Ka. Design wise, it was wearing Aston Marin’s front grill. But then it was quite a departure from Figo gen-1’s inherent character of being fun and perceptive safe build. And thus it seems to become a sales dud on arrival. Though 1.5L diesel engine was very good. Facelift came in 2019, with an all-new 1.2L dragon series petrol engine and same old 1.5L diesel engine, but couldn’t save the nameplate, and again received the same lukewarm response.

More recently Ford has introduced a 6 speed torque converter for the Figo 1.2L engine, a welcome move though, but way too late, isn’t it!

Freestyle (2018-2021)

To revive Figo’s sales, Ford India brought in a crossover version, even before actual Figo gen-2’s facelift, and at a relatively lower price point. It has a lot of cosmetic upgrades in form of several glossy black parts, cladding all around, front skid plate, smoked out headlamps, and roof rails to show off its outdoorsy credentials. Also, the suspension set up was altered to enhance ground clearance. It seems to be price re-positioning effort by Ford India marketing department. Well, volumes were slightly better than Figo gen-2’s first few years of launch, and then it fizzled out. If fundamentals are weak in first place, product cannot survive.

SUV/Crossover segment

Endeavour Gen-1 (2003-2007-2009-2014-2015)

Ford’s SUV journey began in India with the introduction of a true blue ladder-chassis Endeavour at a price point of ₹12,90,000 with a 2.5L turbo diesel engine in 2003, and wholesale started from January 2004. The Endeavour was brought into India via CKD route from Auto Alliance (JV between Ford and Mazda) plant in Thailand. It was a tailor-made product for the Asian market based on the popular Ranger pick-up platform, and was first launched in Thailand in March 2003 by the name of Everest. Since the Everest brand was already in use by the maker of spices in India, Ford has rechristened it as Endeavour for India.

It quickly struck chords with the Indian customer segment, who wants to show off their muscle power – buyer segment was someone, in easy to read words – politicians and contractors. A politician in those days aspire to buy imported Toyota Landcruiser or Prado, but those who could not afford, had a choice in Ford Endeavour, and those who can’t afford Endeavour, settle down for Tata Safari or Mahindra Scorpio, relatively poor wannabe have to settle even further down to Mahindra Bolero. Look another way round, then Tata Safari or Mahindra Scorpio owners finally got something like the next natural upgrade option. Some say that Tata’s designers were also got obsessed with Endeavour’s popularity and the 2005 facelift was inspired by Ford Endeavour.

2007 facelift received a power bump of 33 bhp and some feature upgrades. Sales improved further, but Mitsubishi Pajero took away considerable market share by then.

In 2009, Ford again gave proper facelift along with an all new 3L diesel engine at ₹ 17,99,000 for 4X4 automatic transmission and ₹ 15,99,000 for the 2.5L 4X2 manual transmission variant (Ex-Showroom, Delhi). It also received a new dashboard with a 7” touchscreen based infotainment system. But then it was the year when Toyota has introduced Fortuner in the Indian market, and started expanding the segment further. Remarkably Endeavour’s volume kept its head above the 3,000 mark till 2011. But thereafter it was showing its age, and Fortuner was eating up its share.

In 2014, Endeavour received its last facelift and was priced ₹19,83,000 for a 2.5L engine with a manual transmission and two-wheel drive while the 3.0L came with an automatic transmission and in 4x2 at ₹ 21,28,000 and 4x4 ₹ 23,06,000.

Endeavour Gen-2 (2016-2019-2021)

Introduced in 2016, it was a more sophisticated, upmarket and rounded SUV than the previous generation, sporting much wanted features in India - panoramic sunroof, and two diesel engine options - 2.2L and 3.2L torque monster (its turbo spooling noise was like music for die hard semi-truck fans). Given the product attributes, it seems as it attracted a new buyer segment as well. Toyota Fortuner gen-2 introduced in 2016, even with lack of features, remained Indian politicians favorite ride, but then those who need those features bought Endeavour – business owners. Sales started at an annual rate of 6,500+, and with continuous feature upgrades, it maintained consistency.

With the 2019 facelift, it got a successful chance to eat into Fortuner’s market pie.

In 2020, a new era of emission norms kicked in and Ford responded with an under powered 2L diesel engine mated to a capable 10 speed gearbox. Fun was relatively less but the feature list was still better than the competition and it soldiered on. Feature(s) and equipment(s) deletion to reduce cost and improve margin became a habit for Ford in India, though it is not much appreciated by Indian customers.

MG was successful in taking away market share from both, Fortuner and Endeavor, with the launch of real-estate on wheels called Gloster. But its end customer segment seems a little different again, those who were looking for more features besides sheer size. That is a big achievement for MG India, as others failed to gain even a toehold in this space, like Mahindra Alturas with its relatively low entry price tag and a good feature list.

Ecosport (2013-2018-2021)

All new ingredients and all new recipe to create something definitive and incredible, that is what Ford Ecosport was. A global product developed in Brazil, with India as a major base of production. With two petrol and a diesel engine option, it was launched at a very aggressive price point of ₹5.59 lakhs, and it was a runaway hit. 1L EcoBoost branded turbo-petrol engine made its debut in India. It looks like SUV and drives like a fun hatchback, and soon caught the fancy of the Indian audience, giving impetus to all new sub 4m monocoque crossover(SUV) segment.

For the first three years, Ecosport had a free run, as virtually there was no competition, which gave Ford India a chance to raise the price and earn handsome profits. Indians were making a beeline to get one and that made Ford India way too much complacent and in some instances arrogant too.

The first time Ecosport faced competition and sales decline was after the introduction of Range Rover inspired Maruti’s Brezza in 2016. Panic could be seen on Ford India’s face as they slashed the price of diesel powered Ecosport by a whopping ₹ 1,12,000, for the petrol version it was in the range of ₹ 53,700 to ₹ 87,400. But then Brezza with only diesel drivetrain option expanded the segment size and Ecosport continued its momentum.

In the wake of competition, Ford India in 2016 introduced a halfhearted minor facelift by adding flickering tube light like DRL around headlamp which can hardly be distinguished during the day, thus defeating the very purpose. However, there were some feature upgrades on all other variants.

2017 saw two new entrants and further segment expansion. Lack of proper facelift means Ecosport was feeling the heat in the segment it actually kick started, and sales continued to remain stagnant, despite a growing segment.

2017 end was the time when Ford India has brought in a proper facelift, with all new headlamps with proper LED DRL, new grille, bumper, instrument cluster and touchscreen based SYNC 3 infotainment system. Ford’s all-new 1.5L Dragon series of petrol engine made its Indian debut in EcoSport, mated to 5 speed manual or 6 speed torque converter transmission. Market too responded well, with sales reaching back to 51,000 level of 2014.

But then came the massive Auto industry decline of 2019, but the entry of Hyundai Venue and Mahindra XUV 300 helped the segment to expand further by eating into an adjacent segment of the sedan, with a similar price point. Time for generation change was due and in absence of one, Ford India has gone for another downward revision of price up to ₹ 57,000 to counter competition. It seems, to slash price, was the only weapon left in arsenal of Ford India’s marketing department.

2020 saw a general COVID 19 induced decline. But Ford was able to upgrade their mainstay 1.5L diesel engine to comply with BS6 emission norms with LNT+DPF based exhaust-gas-after-treatment process, with a slight price increase. But later, DPF clogging became another nightmare for Ford and its customer in India.

Interestingly, 2021 sales of the sub 4m monocoque body crossover(SUV) segment has already crossed 4 lakhs size, that’s largely because of new entrants like Nissan Magnite and Renault Kiger, adding all new low-end-price-spectrum, and KIA Sonet, stretching the higher side of the price spectrum. Also, there was another Ecosport facelift in the pipeline, which unfortunately will not see the light of the day anymore!

Ford’s Export business

In 2017-18 Ford contributed 25% of Indian PV export. It is an interesting business model championed by Ford and later successfully followed by Hyundai, VW and Nissan. In fact, VW and Nissan manufacturing units survived in India due to the export of Polo/Vento and Sunny (best seller in Mexico called Versa in the local market) to Mexico, respectively. They have built export oriented plants thus producing left hand driven cars on the same assembly line. Since 2014, Ford India was exporting more cars from India than selling in the local market.

For certain years Ecosport also happens to be the best exported car from India as well. Shortfall in domestic demand was well compensated by export volume. At times Ford India was prioritizing export over domestic demand as well, thus creating artificial scarcity for certain variants. Figo Gen-2 was exported and sold in other markets by the name of Ka.

New Greenfield plant - Sanand, Gujarat

During the 2009 planning phase, capacity at Tamil Nadu based plant was appearing to be nearly full with all new products lined up by Ford then – one of the major global production base for Ecosport and new global Fiesta for the Indian market.

That might have necessitated a new plant requirement. That could be done by Greenfield expansion of their existing plant. But only 2,50,000 units overall capacity expansion was possible at the said location. But then sops would have been limited as they already have had existing benefits in place from the state government. So they must have started scouting for new benefits in some other states with similar geographical advantage of proximity to the seaport for exports, as India was envisaged as a base for a compact car and small engine manufacturing.

They zeroed it down to Sanand in Gujarat, where Tata Motors had established (relocated) Nano (PV) production plant in 2009, which is having proximity to an export oriented port. So they built a separate state of art greenfield production plant with a billion dollar investment (including product development), in Sanand Gujarat, with an annual capacity of 2,40,000 units and an engine capacity of 2,70,000. Since these two products bombed badly in 2015, production capacity remained underutilized due to a lack of domestic uptake.

It was the export which later accounted for 70% of production, still kept some momentum alive. With some export market demand drying up, Ford was struggling badly with the fixed cost of the Sanand plant. And write-off of product development cost might have even eroded the net worth section of the company’s balance sheet. That means Ford need to infuse fresh capital to keep business going.

Product failure is part and parcel of any business. Even Maruti and Hyundai have delivered failed products, based on their own yardstick. But the key is to learn – not only from one’s own mistake(s) but from others as well, as later is free of cost, and of course not to repeat. MG and KIA’s recent success, the resurgence of Tata Motors PV Business Unit and Nissan India, are testimony of the fact that gaining share in the Indian market can be challenging, but not unfathomable - only with the right product (read it as attributes which Indian customers and consumers actually value) at the right price.

Ford has been rewarded with a good market share for their efforts – remember how Ikon was the second best-selling sedan for three successive years in India, Ecosport kick started an all new growth segment. But then, not having a proper vision for product portfolio expansion, mismanagement of product life cycle (lethargy and complacency is a bad cocktail), and on top, heckling with its own perfected DNA, especially what a given set of customer segment does value in India, was the cardinal sin committed by Ford in India.

In a bigger context, Ford India was not even having a proper vision and solid product roadmap for India. At home, they are good at making pick-up (light trucks) and SUVs, and in Europe, they have been quite successful in selling hatchbacks, what respective market demands. In fact, they now have a purpose built electric SUV/crossover platform too in their American portfolio. Indian taste is by and large similar to the USA, for SUVs and chrome, and not for pick-up though. So, after the success of Ecosport (2013) in India, they should have a clear roadmap for SUV/Crossover, but then they never had.

For turnaround - Tata came back with an entirely new SUV/Crossover portfolio, even an electrified version of Nexon. Fallacy became a trap for Ford in India.

From a corporate strategy point of view, retrenchment from a particular market or segment is not a bad thing to do. Look at General Motors, they exited the European and Indian market in 2017. End result – their margin has improved on a consolidated level, PSA turned around Vauxhall and Opel brands (owned earlier by GM) in Europe. On a global level, this may work for Ford as well after leaving Indian and Brazilian markets in 2021, where they were losing money hands over fist.

Check out BHPian comments for more insights and information.

• Member Content

Related News

• Initial impressions of my new Ford Ecosport after 1 week / 1500 km
• Got a used Ford Ecosport: From a petrol / CNG AT to a diesel MT
• Pleasant experience with Ford's RSA when my Ecosport's battery failed
• Looking to update my Ford Ecosport's fascia to MY2019 or later versions
• Ford EcoSport 1.5L Diesel: 1.8 lakh km service cost me Rs 26,000
• Bangalore International Auto Expo 2010: March 11-15
• Mercedes Benz launches the E250 V6 petrol and E250 CDI Blue Efficiency V6 petrol and E250 CDI Blue Efficiency
• Honda Launches Special Edition Jazz
• Mahindra launched Thar at 6.5 lakhs

Find Car News

Team-BHP.com

• Road Safety
• Key Features

Buy & Sell USED CARS

• Rs. 2 Lakhs or less
• Rs. 2 - 4 Lakhs
• Rs. 4 - 6 Lakhs
• Rs. 6 - 8 Lakhs
• Rs. 8 Lakhs or more

• Jawa 42 FJ | Launch Report
• Audi A6 roadtrip to Mahabaleshwar
• Slavia 1.5L DSG | 1 Year Review
• I test-drove the Curvv EV & Diesel
• Close Look: Maybach EQS 680 SUV

Become A Fan

Stay updated.

Keep yourself tuned in to the Indian automotive scene via Twitter, Youtube or RSS feeds.

MBA Knowledge Base

Business • Management • Technology

Home » Management Case Studies » Case Study: The Magic of Ford

Case Study: The Magic of Ford

In 1903, in a small wagon shop in Dearborn Michigan, a man by the name of Henry Ford started what is today the Ford Motor Company. It started it in 1896 when Henry Ford built his first car. It was only experimental at the time, but less than ten years later in 1908 he introduced a more updated version to the public. This became known as the Ford Model t. Once people realised what a wonderful novelty this was and how it would greatly facilitate their lives, there was a huge demand for them. In order for the company to be able to satisfy this heavy demand, ford introduced the world’s first assembly line for cars. It revolutionised the industry. By 1923 more than half of America’s vehicles were made by Ford. Today, the Ford Motor companies the number two company in its industry as well as the number two industrial corporation in the world. When the average person thinks of the Ford Company, they think of just Ford. This thinking, however, is incorrect. Ford is divided into four major components, automotive, Ford credit, Visteon and Hertz. Ford also produces vehicles under the names of Aston Martin, Ford, jaguar , Lincoln and the Mercury and Volvo brands.

Recently, Ford profits have increased significantly, for the nine months ending 30/09/06; total revenues increased 9% to 127.48 billion dollars. Net income from continuing operations decreased 10% to $4.32 bllion dollars. Results reflect increased vehicle sales offset by higher warranty and costs related to the Firestone recall. Last year’s total sales went up 13% to become 163 billion dollars and profit also rose 10% to become $7.2 billion dollars. As far as Ford Motor Company can remember, this is more than any other car company ever. Ford’s main automotive competitors are General Motors, DaimlerChrysler, Toyota, Honda, Nissan and Volkswagen.

One of the ways that ford has established its spot as the number two company in the automotive market is its focus on customer satisfaction. Ford Motor Company admits that its greatest asset is the trust and confidence earned from its consumers. When people see a Ford trademark, Ford wants them to associate that with a trust mask of certitude, quality, reliability of performance and value. Ford strives to connect with their customers as well as reach them. They try to use relationship marketing, because it is cheaper to keep an old customer rather than to attract new ones. William Clay Ford, Chairman of the the Board for Ford Motor Company says that satisfying customers goes beyond great products and services. People want to do business with companies who care about them and their environment. He realises that the best cars are socially and environmentally responsible. Chief Executive Officer, Jacques A. Nasser states, “ we will be a leader in corporate citizenship if we are a well trusted company that people believe contributes positively to a society and uses its resources to create a more sustainable world .” Jim Vannier, Manager of Ford’s advertising and marketing programs admits “ if you listen to your customer, if you provide the right product at the right time, you’ll get the numbers” . The above quotes make it quite obvious that the top executives of the company all concur that customer satisfaction is of the utmost importance in succeeding. If they keep the customer happy, the customer will tell the others they are satisfied, and more and more people will be wiling to consume their product.

Here and Now

The twentieth century was profoundly affected by the innovations of Henry Ford. The inventions of the automobile gave opportunities to multitudes of people. These opportunities were not just in transportation, but in occupation as well. Today, no matter where a Ford is produced, the consumer knows that they are receiving a high quality product. The reason for this is that the majority of Ford vehicles parts are designed by Ford engineers, manufactured in Ford plants and assembled in Ford product lines. When you purchase a Ford product, you are truly purchasing Ford quality. Ford is the number two manufacturer of automobiles, second only to the General Motors Corporation.

This case highlights certain strategies of this corporation that propelled it to its current number two spot in the market. There are many aspects of marketing strategies that will be discussed in this case such as, product strategies, promotion strategies, pricing strategies as well as internet marketing and other forms of product distribution. Each one of these strategies plays a key role in the success of the number two motor company in the automotive industry. Many people tend not to realise just how important the marketing of a new product can be. It plays a huge role in the success or failure of the new product. For example, many people may remember many years ago when Ford came out with a new vehicle called Edsel. The Edsel became known as one of the Ford Motor Company’s lemon. Although the thought of such an odd-looking car does not sound appealing, it is said that the look is not what caused its downfall. Surprising as it may sound, the demise of this vehicle was due to poor marketing strategies. Ford’s biggest mistake in marketing the Edsel was their failure to decide on their target market. They tried to market their product to everyone, and with such a large span of people this was next to impossible for becoming a success.

Objective of the Company

The mission of the Ford Motor Company is very basic. Ford sees their customers as one of the most important things; they know their customer satisfaction also plays a gigantic role in their success. “[their] mission is to improve continually [their] products and services to meet [their] consumer’s needs, allowing [them] to prosper as a business and to provide a reasonable return for [their] stockholders, the owners of the business. Their mission shows their devotion to constantly improve and while improving, accommodate their customer’s needs. Ford’s five main principals include, 1) Quality: they put the quality of their products first and foremost. Without a quality product, people have no desire to waste their money or jeopardise their safety. 2 ) Customer Care : of you don’t take care of the Customer, someone else will. 3) Constant Improvement : if the Ford Motor Company allowed themselves to remain stagnant in their environment, their competition would eventually have a huge advantage over them, because they would have newer and better product lines to offer. 4) Employee Involvement : Ford wants each and every employee to be involved in their company. The happier the employee, the better they work. It is all about feeling that they are a part of the Ford team. They also want their employee to think like a consumer, they can cater more to the needs of their actual consumers because they will know what the consumers want. 5) They consider dealers and suppliers to be their partners : without the dealers and suppliers Ford would not be able to manufacture the things they need alone and therefore would not be able to produce as many vehicles as there would be a demand for or even be able to distribute them all to people.

Ford has many competitors. Since Ford is ranked the number two companies, its main competitor is quite obviously the number one company, General Motors Corporation. General Motors, also an American Company holds 29.4% of the automotive market share while following close behind them the Ford Motor Corporation holds 25.1% of the top 5 best selling cars in 1999, Ford Taurus appears as number three and Ford Escort appears as number five in a recent survey. The automotive industry has fierce rivalry among its competitors. In the past years the following mergers have occurred- Daimler Benz acquired Chrysler and Ford bought Volvo in order to be able to properly compete with General Motors, this way Ford is not allowing General Motors to become too much larger than they already are. If General Motors develops a new feature or automobile, Ford must be right behind them with their most innovative invention, and vice-versa.

Ford has 25.1% of the market share presently. This is quite impressive considering that the number one automotive company, General Motors, also an American company has 29.4%. This means that the top two companies hold more than 50% of the market share. This is quite extraordinary. The total market value of the Ford Motor Company is approximately $56 Billion Dollars and their profits are well over $7 Billion. In 2005 Ford sales raised up to $163 billion dollars. This was a thirteen-percent increase from the previous year.

A car, if not properly assembled, maintained, and operated can become a deadly weapon. The United States government regulates many aspects of the auto motive industry. Among these regulations are seatbelts, airbags and shatter proof windshields. The government has also made inspection and maintenance programs more expanded, in order to include more areas and allow for more stringent tests. In 1990 the government amended the Clean Air Act. The main focus of the act was to cut down on all the urban smog, carbon monoxide and particular emissions from Diesel engines and to help decrease acid rain and toxins that motor vehicles contribute to. The amended act demands that polluted cities must sell improved gasoline that helps to reduce ozone forming Hydrocarbons and Carbon Monoxide. Once inside an automobile, the operator of the vehicle is responsible for obeying many regulations as well. It has become extremely important, for instance, to wear your sea belt. Primary enforcement eat belt laws allow police to stop and ticket a driver for not wearing a seat belt, just like any other traffic violation. Seventeen states and the District of Columbia have enacted these laws. The remaining 32 states have secondary laws that allow law enforcement to ticket a driver for not belting up only after the person has been stopped, or ticketed, for another violation, and one state does not have any seat belt law. Obviously, safety best laws work, and the public overwhelmingly supports them. Three out of four Americans supports safety belt laws, according to a recent public opinion survey. Stronger safety belt and child passenger safety laws, and stepped up enforcement of those laws, are the most effective steps we can take to save lives.

Corporate Responsibility Towards Society

Ford Motor Company sponsors many programs to better the community and their safety. For example in the Detroit area, ford organised a weekend clinic in which the automotive safety office educated fifty-five people and their children on the proper use and installation of child safety seats. They demonstrated this in the consumer’s actual vehicles. Ford is also committed to environment cleanliness. They sponsor programs to educate our children on environmental cleanliness and responsibility. They also sponsor company-wide recycling, cleaner operating vehicles, recyclable components, cleaner manufacturing, and employee involvement in environmental activities. Ford do not do these things because they have to, they do it because it is the right thing to do. The Ford Motor Company not only is social active, but culturally as well. Ford provides financial support at many historically black colleges such as Tuskegee University in Albama, this is where the famous black inventor George Washington Carver performed many of his experiments. Ford Motor Company, as of 1999 has 23.2 percent of its employees as minorities. This is up 1% from 1998. Diversity makes the business world go round and no one knows this better than the Ford Motor Company.

Innovation or Death

The Ford Motor Company values their product Analysts. [Their analysts develop product cycle plans that help forecasters determine [their] approach to different markets. The people who start the product cycle are called the research, Design Packaging and Financial analysts. The researchers find out what type of things that consumers would like their vehicles to be occupied with. The Design packagers are the people who decide the most appealing way to package the final product. The financial analysts put the numbers together to figure out exactly how much money all if the above will cost. Next, designers and engineers along with testers actually create the vehicles. They create vehicles according to the specifications of the Research, Design Packaging and Financial Analysts. This way they are producing what the market wants. The research and Advanced technology Teams then decide which technologies should be used in the new products. Ford is constantly trying to improve their product development and expand their innovations. Currently, Ford is working on a new line of intelligent vehicles. These vehicles will enable the driver, through voice activation, to connect to the internet. The voice activation will also be implemented into the navigation system, heating and air-conditioning, cell phones, audio systems, and other electronic things inside the automobile. Ford is adapting to each change in order to be able to bring their customers the most innovative and convenient products possible. As son as new technology becomes available, Ford Motor Company is among the first few to try to implement it into their vehicles.

Product Targeting

Ford motor company has different types of cars, which are each targeted towards many different markets of people. As the company learned the hard way with the Edsel, the importance of a target market is extremely high. Loss of a target marketing focus usually means loss in sales. Ford has a different car targeted towards different age groups, personalities, genders and economic standing and more. The ford Mustang, for example, is targeted mainly at the middle aged. This is exhibited by its slogan of it is what it was and more. This implies that the target consumer would be old enough to remember what the mustang was when it first came out in the 1960’s.

Another example is ford trucks. Their slogan is “Built Ford Tough ”. The toughness implies a target towards rugged men. Because of the fact that the word “tough” is used, it seems that it would be very unlikely that the ford motor company would be using that to attract women. When the word tough is thought of, women are generally not the first thing that comes to mind. The third and final example is the ford Taurus. Its slogan is “ford makes it smart to buy American.” The target market for a ford Taurus is a family. The Taurus station wagon for instance is a great family car with tons of room, yet it handles like a sports car. The above three examples are only a small sampling of what ford offers. Ford motor company manufactures sedans, SUVs, trucks, luxury cars and more. If you are looking for it, the odds are that ford will satisfy you.

Product Mix

The Ford Motor Company has such a wide selection of vehicles in order to satisfy every different type of potential consumer. They offer small cars, sports car, midsize cars, luxury cars, vehicles, convertibles, wagons, minivans, vans, trucks, commercial trucks, and even environmentally efficient cars. Each of Ford’s different types of vehicles have many different options that came along with them the 2001 Explorer for example, runs to roughly $25,715 dollars, without any extras. However, should the consumer decide that he or she would like to add perks, there would be many choices. For instance, in the convenience group of options, you can add anything from a cargo cover to speed control. In the XLS sports group anything from chrome steal wheels to wheel mouldings. There is even a trailer tow prep package, which includes a wiring harness and an H.D. Flasher for only $355 dollars extra. After that the consumer has the option to add even more options. They can customize the engine, transmission, drive, rear axle, wheel type, tire type, seat equipment and much more. The company also offers the Explorer in 10 different colours for the exterior. With the plethora of the above options, how could anyone not find what they are looking for? Each one of the 24 cars manufactured under the Ford name has many options as the Explorer, if not more.

Services Offered

When you own a Ford vehicle, you can register for Owner’s Services. This includes reminders of when your vehicle needs to be services, tips for vehicle safety, maintenance information, does it yourself pointers and online manuals. It also includes warranty guides, offers and discounts exclusive to people registered for the service, online shopping, private communications, and links to Ford Company Specialists. Ford, Lincoln, and mercury dealerships specialize in the servicing of their own vehicles. The dealership is a wonderful place to go to have your breaks served, shocks replaced and batteries as well. The company also offers Extended Service Plans(ESP). With the extended Warranty Plan and the factory unlimited Warranty; you are able to choose a plan that suits your needs. The way the plan works is, you pay a small deductible anywhere from $0-$100. The ford ESP cost protects the consumer from increasing prices in labor and increased prices in parts. Other services that are offered by Ford Motor Company area Customer Assistance Centres, Collision Assistance, Roadside Assistance, Technical Service Information and their website. The web site includes links to safety tips and Frequently Asked Questions.

Promotional Strategies

The current promotions that are offered by the Ford Motor Company are Radiator Service, Brake service, and Batteries. All of the above promotions are wonderful for the upcoming winter months. The radiator service includes, top of all fluids and a free 12pt all weather check of hoses, clamps, belt and more. This promotion and all of the above promotions appeal to people who are thinking ahead to cold winter months. This winter in New York has been predicted to be one of the worst we have seen in a while. A radiator is not actually something you would want to break down in the middle of a snowstorm. The battery promotion is offering a Motorcraft tested, though series battery. They are also offering a Silver Series Battery for only$20 dollars more. Each promotion for a new battery comes with over an 83-month warranty. It is a good idea to replace your battery before a new winter season. When it is freezing outside, trying to find a Good Samaritan who is willing to give you a jump is a rarity. The Brake Promotion comes with the Motorcraft brake service. This promotion includes replacement of brake pads or shoes, front or rear turn rotators and drums. This promotion will also check the brake’s hydraulic system and repair, if necessary. This once again appeals to the person(s) who is preparing for the harsh winter to come. Being that, a bad winter generally means a lot of snow and ice. With weather conditions like that, who needs to worry about brake failure?

Pricing Strategies

One of ford’ pricing strategies is the fact that they try to help the consumer finance a ford vehicle. Ford offers its consumer many plans to choose from in order to find the financing option that best fits their needs. The following are only a few of ford’s financing options. The first is the Red Carpet Lease: the consumer is offered flexibility for payment; there are advance payment plans and Additional payment programs, depending on which one is best for you. The second financing plan is mobility financing: mobility financing offers flexible and convenient financing terms for their physically challenged consumers who need adaptive equipment in their vehicles. The finance rate is based on your credit and the terms of the transaction. Ford credit has earned a top ranking place in the world of automotive finance by providing loans and leases that are convenient and affordable. They also specialize in service such as commercial lending and municipal financing.

The municipal financing is so convenient that it can be calculate on the internet. All that needs to be done in order to do this is, select a vehicle, model, make, and product line. The online calculator will give the consumer an estimated lease and retail payment. Ford financing company provides a verity of products and services to both, the dealers and the consumers. Ford credit also has a commercial lending operation, which caters to light truck fleets and heavy trucks. Ford wants to make it as easy as possible for consumer to be able to drive a ford. There are so many different financing options that are offered, that finding a plan that is right for you has become easier than ever. If buying a new vehicle is not financially possible, then ford also offers a whole line of pre-owned vehicles, which are backed by Ford Motor Company with a 100 point inspection.

Distribution Internet Marketing

Ford’s newest web site for ford division cars and trucks is www.fordvehicles.com . the new web site allows perspective customer to compare ford vehicles to other cars made by other manufacturers. They are the first company to give consumers the option of product comparison. The section of product comparison on the web site comes complete with photographs, feature description, safety options, competitive pricing, financing and warranty information. Ford division internet coordinator, Trisha Habucke states , “With our new design we incorporated new technologies that deliver more visually exciting content.” The web site is so user friendly that consumers can just go right from one ford vehicle to the next with out any trouble. Ford is committed to brining their customers total brand experience.

For example, ford knows that people with certain types of personalities are attracted to certain types of cars. Explorer drivers, for example are rugged, the “No Boundaries-ford outfitters” slogan appeals to them. When ford began their internet market, they did the most extensive research even conducted by a car company. Their advertising agency, J.Walter Thomson found that 210 test participants concurred that the Ford website deserved a high rating for its complete content. Ford attributes a fair amount of the success to the internet. The internet is a way reach millions of people. The company realizes that is has been a powerful tool is the internet. Erin Hughes, who is a ford employee since 1999, admits that her greatest tool is the internet. Erin’s Regional Manager realized that if they had one person whose sole job was to be dedicated to the internet, the company would proper.

Erin later became the first internet customer satisfaction coordinator. In addition, Hughes started the first internet club for ford dealers. Since the position of internet coordinator so now more common at ford motor companies, once per month all of the internets coordinators get together to share their most recent e-commerce news and best practices. Hughes says “ my job is to provide our dealers with the resources and technology needed to help them sell more vehicles on Main Street and E-street ”. Advertising also plays a large role in the distribution of ford motor company’s products. Ford advertises on television quite often and also on the radio. Previous slogans that ford had etched in everyone’s minds include things like “ Have you Driven a Ford Lately?” with a catchy little tune along with it. Ford also has their slogans and products photographs on major highway billboards a cross the county as well as scoreboards at sporting events such as during commercial breaks where the broadcaster will say something along the lines of sponsored by Ford Motor Company.

The ford motor company has come a very long way, since Henry Ford first established it. They went from a little wagon shop to the second leader in automotive sales. They have been around for almost a century. Ford has elaborative marketing strategies as well as distribution strategies . Their web site was extremely easy and fun to use. Ford is also a very well rounded company in that they are very environmentally concerned. It is nice to see that people realized, if we don’t save our planet now there will be nothing left for future generations. With Ford’s experience and high understanding of, and ambition for the satisfaction of the customer, can they some day be the number one automobile company, beating out the General Motor Corporation?

Q1. Asses the reasons for the growth of the Ford Company.

Q2. Interpolate from the case the clout that the company has in the world economy.

Q3. Assess from the consumer’s perspective the performance of the company’s product.

Related posts:

• Case Study: Henry Ford’s Contributions to Organizational Behavior and Leadership
• Case Study: Lenovo’s “PC Plus” Strategy
• Case Study on Business Ethics: Napster Copyright Infringement Case
• Case Study on Entrepreneurship: Rashmi Garments
• Case Study: Starbucks Growth Strategy
• Case Study on Entrepreneurship: Richard Branson
• Case Study: The International Growth of Zara
• Case Study: The Merger between Daimler and Chrysler
• Case Study: Failure of Vodafone in Japan
• Case Study: Why Did Euro Disney Fail?

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Product details

Teaching and learning

Ford Company’s Innovation for Better Competition Essay

• To find inspiration for your paper and overcome writer’s block
• As a source of information (ensure proper referencing)
• As a template for you assignment

Background and Problems Facing Ford

Key insights identified for better competition, solutions employed by ford, results achieved, recommendations for future performance, works cited.

Ford is one of the revered car brands in the global market. The Ford Motor Company has “its headquarters in Dearborn, Detroit” (Hoffman 5). Henry Ford founded the automobile company in 1903. The firm has become a leading manufacturer and marketer of automobiles around the globe. The firm is known for producing the Lincoln and Ford brands. Ford competes with different companies such as General Motors (GM), Volkswagen, Toyota, and Mercedes Benz (“Ford: Competitive Advantage” par. 2). Throughout the years, Ford has been using powerful approaches to attract more customers and improve its sales. For instance, the introduction of the Ford Mustang in 1964 revolutionized the firm’s performance.

Ford also introduced and marketed new vehicles in different parts of the globe. The success of the firm led to the acquisition of Aston Martin in 1990 and Jaguar Cars in 1994 (Hoffman 27). However, the beginning of the 20 th century was characterized by numerous challenges such as increased fuel prices and healthcare costs. The company’s sales also decreased significantly (Hoffman 27). These issues affected the firm’s productivity and profitability.

Despite these mixed results, Ford has continued to embrace the most appropriate strategies in order to create and hold value. To begin with, the company examines the changing needs of different consumers in order to promote the best practices. The Ford Motor Company also embraces new technologies to produce superior cars that can compete successfully in the market (“Ford: Go Further” par. 3). The firm uses the power of research and development (R&D) to engineer appealing vehicles for more customers. These approaches have led to new competitive advantages. Such strategies continue to create and hold value for the organization.

From 1980, the Ford Motor Company began to monitor the major issues that promoted or affected its performance. Towards the end of the 20 th century, the organization acquired different firms in order to become more competitive. Such developments were supported by the firm’s financial strength. However, the 21 st century was a challenging period for Ford. The company was unable to compete in the industry due to several factors. For instance, the firm was mainly relying on the profits obtained from the sale of Sports Utility Vehicles (SUVs). North America was also facing numerous challenges such as “increased healthcare costs, loss of market share, and unsustainable fuel prices” (“Ford: Competitive Advantage” par. 3).

The emergence of such problems forced the company to introduce new business strategies. In 2006, Ford decided to drop most of its inefficient and unprofitable car models. The move led to the loss of over 30,000 jobs (Hoffman 81). As well, the company closed fourteen of its major factories. Production lines were also consolidated with the aim of boosting performance. Ford partnered with different companies such as Southern California Edison (SCE) to produce superior vehicles (“Ford: Go Further” par. 6). The firm embraced new transformational changes in order to improve the level of performance. In 2012, Ford began to revive most of its business operations. Ford’s “business model became sustainable and showed signs of future improvement” (“Ford: Go Further” par. 3).

Since then, this brand has been focusing on the best approaches in order to deliver valuable experiences to more consumers. This goal is currently achieved through the continued use of positive leadership. The CEO and his subordinates always embrace powerful ideas that can deal with competition. In order to remain successful and deliver value to more customers, the important approach has been to monitor the changing demands of the global consumer (Hoffman 83).

The Ford Motor Company is currently focusing on innovation because it has the potential to deliver an exemplary experience to the consumer. The firm recently expanded its Palo Alto Research and Innovation Center (PARIC) in order to support more customers (Banham 18). Ford promotes outstanding practices that can deliver new vehicles while at the same time maintaining the image of the brand (Hockfield 9).

Experts believe strongly that this automobile brand has managed to deliver specific benefits to its customers. For instance, the cars marketed by Ford are characterized by modern technologies thus reducing fuel consumption. This is a major economic benefit associated with the brand. The cars also have “superior applications and maneuverability thus improving their performances” (“Ford: Competitive Advantage” par. 4). The R&D department has improved some functions such as “shock absorption, comfort, and suspension” (“Ford: Go Further” par. 4). The brand has continued to serve the emotional and perceptional aspects of targeted customers. The brand is self-expressive and admirable. These qualities make it more successful in different regions across the globe.

The past experiences, opportunities, and challenges faced by Ford forced its managers to outline new solutions. The main goal was to deliver value to targeted customers. As mentioned earlier, the beginning of the 21 st century presented numerous challenges thus affecting the profitability, performance, and competitiveness of the company. During the same period, companies such as Toyota were performing positively especially after introducing the use of lean production methods (Banham 63). During the same period, several competitors in the industry conducted numerous researches in order to produce sustainable cars. This move was necessary due to the issues revolving around the problem of climate change. The “global automobile industry introduced new aspects at the time when Ford was struggling with numerous challenges” (Banham 69).

These challenges played a major role in redefining the future of Ford. The brand promoted transformational strategies in order to achieve its business goals. The main focus was to produce superior cars that could satisfy the ever-changing needs of every targeted customer. The new leaders at the firm were on the frontline to present powerful solutions. New innovative measures were also supported in order to ensure the brand competed successfully in the global market (“Ford: Competitive Advantage” par. 7). Ford decided to address the demands of every global customer in order to achieve its potentials (Banham 63). This single choice played a significant role in transforming the future performance of Ford.

Ford has continued to introduce exemplary features to its customers. The leadership embraced at the company promotes innovative ideas thus introducing revolutionary features in every car. For instance, Ford managed to introduce smaller cars that met the needs of more customers. Such cars consumed less fuel thus promoting the concept of sustainability. The company also redesigned the shapes of its cars in order to become more appealing (Banham 23). Ford produced different cars for specific regions across the globe (“Ford: Competitive Advantage” par. 6). This move was undertaken in order to target more global consumers. These aspects have continued to make Ford different from the other competitors in the automobile industry.

These differences have been critical towards supporting the goals of the company. For instance, Ford has recorded “increased sales since 2013” (“Ford: Go Further” par. 5). The decision to produce differentiated automobiles explains why Ford is currently marketing more cars in different corners of the globe. Ford’s Lincoln car brand has been “re-engineered to become a luxury product that addresses the needs of many consumers across the globe” (Hockfield 47). This brand has recorded increased sales in China, Europe, and North America. Haas-Kotzegger indicates that the brand has led to positive gains for the company (4). Analysts in the industry also believe that Lincoln will continue to increase Ford’s operating margin within the next ten years (Haas-Kotzegger 9). The current population growth rate experienced in China and other parts of the globe will support the performance of the brand.

It would be wrong to argue that Ford has maintained relevance within the last five decades. This is true because the company did not promote various competitive advantages throughout the 20 th century. However, the emergence of numerous challenges forced the brand to embrace new measures that could revolutionize its performance. From 2010, Ford began to focus on the changing demands of the global consumer (Hockfield 31). The firm consolidated its operations in order to remain relevant in the market. This goal was possible because the company was still appreciated and admired by many potential consumers. The measures are undertaken by Ford to explain why the brand remains relevant today.

The narrative behind this brand is that Ford will continue to innovate and deliver superior cars that can deal with competition. Ford has been recording more profits every year since 2010. New leadership practices have emerged at the company thus promoting the best practices. The company’s Lincoln brand has become the car of choice in China and North America (Haas-Kotzegger 12). These results show clearly that Ford will continue to achieve its business potentials.

In order to remain competitive, Ford uses powerful communication strategies to inform more people about the superiority of its brand. For instance, the company’s website informs more people about every new car. Marketing focuses on the best approaches that can inform more people about the advantages and strengths of the company’s cars. The portrayal of Ford as “the leading innovator and producer of new features defines its brand image” (“Ford: Competitive Advantage” par. 6). These aspects make Ford an admirable brand in the global automobile industry.

Companies “that fail to plan about the future will eventually become irrelevant” (Hockfield 98). Ford lost its market share because of poor planning and the inability to predict the future. The current wave of technology is giving companies such as Toyota and Volkswagen new opportunities. Ford should be aware of the challenges and problems that might affect its future performance. The firm should embrace the best innovative ideas and technologies in order to produce superior vehicles. As well, marketing should be taken more seriously than ever before. An informed consumer will be willing to purchase this brand and eventually increase the company’s competitiveness. Social media can also be used to sensitize more people about this superior brand. Emerging markets in Africa, Europe, Latin America, and Asia should also be targeted (Haas-Kotzegger 12). This approach will encourage more people to buy Ford cars. These recommendations will eventually make Ford one of the most successful brands in the world.

Banham, Russ. The Ford Century: Ford Motor Company and the Innovations that Shaped the World. New York: Artisan, 2002. Print.

Ford: Competitive Advantage 2015. Web.

Ford: Go Further 2016. Web.

Haas-Kotzegger, Ursula 2013, Ford Motor Company: Learning from the Automotive Industry . PDF file. Web.

Hockfield, Victoria. A History of Ford Motor Company: Henry Ford, Vehicles, and Criticism. New York: BiblioBazaar, 2010. Print.

Hoffman, Bryce. American Icon: Alan Mulally and the Fight to Save Ford Motor Company . New York: Crown Business, 2013. Print.

• Amazon's Online Shopping and Innovative Delivery
• London Heathrow’s Terminal 5 Planning and Factors
• The Ford Motors Firm's Six Sigma Project
• Ford Motor Company: Redefining Strategies
• Ford Motor Company Case Study
• Linde Company: Terminations of Employment Contracts
• Amy's Ice Cream Company's Success Factors
• Henry Ericson's Problem Case
• Ryanair Company's Staff Issues
• Unnecessary Conflict in the Workplace: NDC Company
• Chicago (A-D)
• Chicago (N-B)

IvyPanda. (2020, September 29). Ford Company's Innovation for Better Competition. https://ivypanda.com/essays/ford-companys-innovation-for-better-competition/

"Ford Company's Innovation for Better Competition." IvyPanda , 29 Sept. 2020, ivypanda.com/essays/ford-companys-innovation-for-better-competition/.

IvyPanda . (2020) 'Ford Company's Innovation for Better Competition'. 29 September.

IvyPanda . 2020. "Ford Company's Innovation for Better Competition." September 29, 2020. https://ivypanda.com/essays/ford-companys-innovation-for-better-competition/.

1. IvyPanda . "Ford Company's Innovation for Better Competition." September 29, 2020. https://ivypanda.com/essays/ford-companys-innovation-for-better-competition/.

Bibliography

IvyPanda . "Ford Company's Innovation for Better Competition." September 29, 2020. https://ivypanda.com/essays/ford-companys-innovation-for-better-competition/.

Advancing scientific understanding of climate, improving society’s ability to plan and respond

Events/Webinars

FY25 ESSM NOFO Informational Webinar

FY25 NIDIS Coping with Drought Competition Post LOI Informational Webinar

Applicant Resources at a Glance

• Current Federal Funding Opportunity (FFO)
• Data Universal Numbering System (DUNS) Number
• System for Award Management (SAM)
• National Environmental Policy Act (NEPA) Guidance
• Application for Federal Assistance  SF-424 Form SF-424 Form Instructions
• Budget Information  SF-424A SF-424A Form Instructions
• Assurances  SF-424B
• Certifications Required by the Department of Commerce  CD-511
• Catalog of Federal Domestic Assistance (CFDA)
• Grants Online
• Code of Federal Regulations (CFR)
• Department of Commerce, Grants and Cooperative Agreements Manual
• Department of Commerce, Grants Management Division

Climate justice in the South Central US: A Three City Case Study

Comparative case study of three cities (Tulsa, OK; Fayetteville, AR; Waco, TX) — assessing climate adaptation efforts for their potential benefits and other effects on marginalized populations (e.g., people of color, low-income residents), using climate planning documents, interviews, and resident participatory mapping exercises. Results from each city will be compared and contrasted with each other to gather important lessons learned from each context for the rest of the SCIPP region.

Funding Opportunities News and Events

NOAA seeks proposals to advance climate research

• August 12, 2024

Modeling, Analysis, Predictions, and Projections (MAPP) Program: Early Career Award for Exceptional Research in Earth System Model Development and Application

Atmospheric Chemistry, Carbon Cycle, and Climate (AC4) Program

FY25 NIDIS Coping with Drought Competition Information Webinar