Multi-National Report on Ford Motor Company Ford Essay

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  • Subject: Business
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  • Paper: #26810565

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Multi-National Report on Ford Motor Company:

Ford Motor Company is a worldwide company that operates in both the Automotive and Financial Services sectors with its major operations being to build up, devise, produce and service cars and trucks. While Ford's automotive sector basically sells vehicles under various brand names such as Ford, Volvo, Mercury and Lincoln, the financial services sector provide several automotive financing products both through and to automotive dealers. Ford's automotive sector is responsible for marketing trucks, cars and vehicle parts through the retail dealers, distributors and dealers in North America. Additionally, this sector offers a series of after-sale vehicle products and services in several segments like car accessories, maintenance, repairs and extended service. On the contrary, the financial services sector provides retail financing, wholesale financing and financing to profit-making customers.

Ford's financial services sector also provides other financing services incorporating loans to dealers for operational capital, developments to dealership services and purchases. The sector also offers insurance services that are associated to the company's financing programs in addition to purchasing receivables. Given that the company operates worldwide, it has several subsidiaries such as the Ford India Private Limited. In the American market, Ford Motor Company is the most financially stable car manufacturing company that has overcome the recent deteriorations in the market. In fact, Ford Motor Company is considered as the second largest automotive firm with General Motors being the first. Since its inception in 1903 by Henry Ford, Ford Motor Company has constantly remained in possession of the family and has been an international company since 1904. The company began to operate internationally after it opened a branch in Canada with the aim of accessing the Commonwealth markets. Ford Motor Company currently operates with a worldwide workforce of close to 213,000 employees.

Market Overview:

The production of vehicles by Ford Motor Company usually takes a period of up to twenty days from the order to the shipping points depicting that the company encounters minimal backlog or inventory development. This production of vehicles is normally higher in the first two quarters of the year i.e. spring and summer seasons in order to contain the peak seasonal demands. An estimated forty percent of vehicle dealerships that are sold by under the Ford, Mercury and Lincoln brand names in the United States were funded by the Ford Credit. However, this percentage is different in other parts of the world like Europe where the figure has remained at a constant of twenty-seven percent. Nonetheless, the funding for wholesale procurements by dealerships is exclusively done by Ford Credit in both the United States and Europe though at different rates. The dealership purchases of both real estate and other large capital expenses by Ford Motor Company and its partners are mainly financed by Ford Credit.

The automotive sector of Ford Motor Company is basically categorized in regions like South and North America, Asia pacific, Europe and Africa. However, the Volvo brand is the only exception to the regional sub-division since it functions as a detached sub-sector which controls the worldwide Volvo sales. The firm's retail sales function under a dealership model that requires all dealerships to sign exclusive contracts with Ford in order to sell the company's vehicles. By the end of 2008, the company operated an approximate of 3,800 dealerships in the United States even though almost half of these dealerships were the Ford brand only. Another quarter of these dealerships in the United States made sales of the Lincoln and Mercury brands only (Dornbach-Bender, Slade & Thorpe, p 6). In the United States market, Ford Motor Company faces severe rivalry from five major opponents i.e. Honda, Toyota, General Motors, Nissan and Chrysler. In the Europe region, the company also faces stiff competition from five major competitors namely Renault, Fiat, General Motors, Volkswagen and Peugeot.

Adjustments of Overseas' Operations:

As mentioned earlier, Ford Motor Company has several subsidiary companies that enable the firm to make sales in international markets. One such subsidiary company that is fully owned by Ford Motor Company is the Ford India Private Limited that produces and distributes engines and automobiles in India. As a subsidiary of Ford Motor Company, Ford India Private Limited sells the engines and automobiles through dealers. In light of the stiff competition in various regions, Ford Motor Company has always adopted various significant strategies for its operations overseas. These strategies are mainly centered on the major segments of the company including & #8230;

Product and Services:

To adapt to its operations overseas, the products and services of Ford Motor Company have usually been the center of focus for the firm. Firstly, as mentioned earlier, the company has divided its products and services into two major segments or sectors which are the automotive and financial services sectors. This has enabled the company to achieve noticeable productivity and adapt to global markets because there is a clear distinction of the responsibilities and activities of each of the two sectors. Similar to the financial services sectors, the roles of the automotive sector are clearly stated regardless of the region in which the company is operating in. The company adopts its operations overseas by ensuring that the automotive sector primarily deals with the marketing of vehicles, trucks and vehicle parts while the financial services sector primarily deals with the provision of various automotive financing products. To achieve this, the automotive sector markets through automotive dealers while the financial services sector provides the products commercial consumers.

The other significant measure of Ford Company that enables the firm to adapt its overseas operations is the type of products that its competitors offer. Ford Motor Company usually offers products that are slightly different to the ones its competitors offer in order to increase its market share within the region. For instance, Ford Company has been forced to focus on different type of products in the United States market because of the fact that Nissan, Toyota and Honda have developed in the market share. These three competitors have grown in this market because of their ability to provide better products at low prices, especially for smaller and fuel efficient vehicles. Additionally, these three competitors of Ford have been able to gain much profit from smaller vehicles due to lower costs of labor and greater efficiency.

Within the U.S. market, Ford has distinguished itself from the kind of products offered by its competitors by concentrating on more profitable SUV and truck lines. While the company has continued to lose money on its smaller vehicles in the U.S. market, the strategy to concentrate on the more profitable truck lines and SUV's is no longer practical because of increased demand. However, the company has registered greater success in making profits on smaller vehicles in the within Europe markets despite the major competition it gets from Volkswagen which is considered as the leading producer in this region. The company has also adjusted its operation in this region by designing vehicles that appeal to European tastes and developing its vehicles quality ratings. Ford has experienced a steady market share and profits demonstrating the company's ability of achieving success with smaller vehicles because of the adjusted products.

Marketing and Advertising:

Ford Motor Company has been able to adapt its operations overseas because of the better products of the company which are promoted and marketed by a refurbished strategy (Thomaselli par, 5). The marketing group of this company adopted various strategies of advertising for the company's operations overseas during difficult times in the automotive industry. One of the significant measures that the company undertook in 2008 was the avoidance of government bailout money, a decision that has enabled it to be more flexible than Chrysler and General Motors in today's market. Earlier this year, the company was named as the marketer of the year in the United States because it emerged from the collapse of the global economy with better products and bottom-up innovative ideas. The marketing and advertising group has helped the company to integrate globally and adjust its operations overseas.

The company adapts its operations overseas by implementing both regional and global marketing and advertising strategies that are aimed at promoting its products. Ford has recently developed its marketing strategies to include a focused marketing message that not only targets potential customers but also targets the present customers. In addition to sending direct emails to its current customers, the company is also engaged in television adverts more than any other automotive company. To promote its products within the United States market, the company merged the advertising and public relations departments. The marketing group leader within this region took some advertising risks with the major one being a truck promotion for F-150 which was an innovative advertisement for a pickup truck.

The company has increased its spending in advertisements in the recent years with much of the money being spent on print, television and internet. Another advertising strategy within this market has been the Swap Your Ride promotion in which Toyota and Honda owners are involved in…

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