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Ford Motor Company

20th century Henry Ford's first attempt at a car company under his own name was the Henry Ford Company on November 3, 1901, which became the Cadillac Motor Company on August 22, 1902, after Ford left with the rights to his name. The Ford Motor Company was launched in a converted factory in 1903 with $28,000 in cash from twelve investors, most notably John and Horace Dodge (who would later found their own car company). During its early years, the company produced just a few cars a day at its factory on Mack Avenue in Detroit, Michigan. Groups of two or three men worked on each car, assembling it from parts made mostly by supplier companies contracting for Ford. Within a decade the company would lead the world in the expansion and refinement of theassembly line concept; and Ford soon brought much of the part production in-house in a vertical integrationthat seemed a better path for the era. Henry Ford was 39 years old when he founded the Ford Motor Company, which would go on to become one of the world's largest and most profitable companies, as well as being one to survive the Great Depression. As one of the largest family-controlled companies in the world, the Ford Motor Company has been in continuous family control for over 100 years. After the first modern automobile was already created in the year 1886 by German inventor Carl Benz (Benz Patent-Motorwagen), more efficient production methods were needed to make the automobile affordable for the middleclass; which Ford contributed to, for instance by introducing the first moving assembly line in 1913. In 1908 Ford introduced the first engine with a removable cylinder head, in the Model T. In 1930, Ford introduced the Model A, the first car with safety glass in the windshield.[8] Ford launched the first low priced V8 engine powered car in 1932. Ford offered the Lifeguard safety package from 1956, which included such innovations as a standard deep-dish steering wheel, optional front, and, for the first time in a car, rear seatbelts, and an optional padded dash.[9] Ford introduced child-proof door locks into its products in 1957, and in the same year offered the first retractable hardtop on a mass-produced six-seater car. The Ford Mustang was introduced in 1964. In 1965 Ford introduced the seat belt reminder light. With the 1980s, Ford introduced several highly successful vehicles around the world. During the 1980s, Ford began using the advertising slogan, "Have you driven a Ford, lately?" to introduce new customers to their brand and make their vehicles appear more modern. In 1990 and 1994 respectively, Ford also acquiredJaguar Cars and Aston Martin.[10] During the mid- to late 1990s, Ford continued to sell large numbers of vehicles, in a booming American economy with a soaring stock market and low fuel prices. With the dawn of the new century, legacy healthcare costs, higher fuel prices, and a faltering economy led to falling market shares, declining sales, and diminished profit margins. Most of the corporate profits came from financing consumer automobile loans through Ford Motor Credit Company.[11]


1. Strong position in US market. Ford is the second largest automaker in US, the second largest vehicle market in the world. Ford has great reputation in its home market and strong commercial vehicle sales that are the most profitable Fords vehicles. 2. ECOnetic initiative. Fords ECOnetic initiative is an effort to produce highly fuelefficient engines by improving existing engines rather than new hybrid engines. The result of this initiative is the Ford Fiesta, currently the lowest emitting mass-produced car in Europe and Ford Focus ECOnetic that has better fuel consumption that Toyota Prius. 3. Sound financial performance. Ford was the only big US car business that didnt need the government bailout and was the first to get investment status back. The firms profit margin is high compared to competitors with the highest liquidity ratio. 4. One Ford approach. Ford has decided to produce single, streamlined global lineup of its models. The carmaker no longer produces customized vehicles for different regions but focus on designing and engineering the car that fits different regional tastes and regulations. It significantly decreases costs for Ford and drives record profitability. 5. Significant growth in China. Ford, although not the strongest player in the China has experienced the significant growth in the largest automotive market in the world for the 2012. It grew its sales by 46%, according to Ford press release.

1. Poor environmental record. Ford has been criticized for poor efforts to decrease environment pollution. University of Massachusetts Amherst have rated Ford as the seventh worst air polluter due to its manufacturing plants. The US Environmental Protection Agency also linked Ford to 42 toxic waste sites. 2. High cost structure. Although One Ford initiative led to substantial cost reduction, Ford still has a high cost structure, compared to other automobiles manufacturers. Fords costs are driven by its generous employee compensation and pension plans. 3. Unprofitable Europe operations. In 2012, Ford lost $1.75 billion in Europe and plans to experience losses in the region until 2015.


1. Positive attitude towards green vehicles. Cars that are fuel inefficient and emit large quantities of CO2 heavily pollute air and negatively affect the environment. Consumers are aware of this negative impact and are more likely to buy green vehicles that emit much less CO2 and are fuel-efficient. 2. Increasing fuel prices. Fords strong emphasis on engineering fuel-efficient vehicles (Ford Fiesta and Ford Focus ECOnetic) with flexible fuel and hybrid engines will pay off due to increasing fuel prices in the world. 3. New emission standards. A new wave for stricter regulations on vehicle emission standards would positively affect Ford position in automotive industry. Ford invests large amounts of money to produce fuel-efficient engines and reaped some success with its ford Fiesta and Ford Focus ECOnetic models. 4. Strategic partnerships. Ford has great experience in creating strategic alliances and partnerships with other automotive companies. Due to current competitive pressure, all companies are more likely to enter into such partnerships to drive R&D costs down, access new markets and gain some new skills.

5. Decreasing fuel prices. Some analysts forecast that future fuel prices will drop due to extraction of shale gas. This would negatively affect Ford as it focus on compact fuel-efficient hybrid and flexible fuel cars that are less attractive when the fuel price is low. 6. Rising raw material prices. Rising prices for raw metals will lift the costs for auto manufacturers and result in squeezed profits for the companies. 7. Intense competition. Ford faces more intense competition from other auto manufacturers more than ever, especially in small cars segment with hybrid engines. 8. Fluctuating exchange rates. Ford, including other largest automotive companies, may negatively be affected by fluctuating exchange rates as it earns more than half of its profits outside the US. The profits may be lower due appreciating dollar against other currencies.


During the past year, General Motors went bankrupt, Chrysler found itself owned by Italy's Fiat. Yet Ford seems to be hitting home runs, knocking them out of the park with regularity. In fact, all of Detroit fared alright in the recent J.D. Power Initial Quality Study (IQS), the benchmark for quality in the auto industry. It measures "problems per 100 cars" as reported by owners who have had the cars for 90 days. New 2009 vehicles sold by Chrysler, Ford and GM's domestic brands have improved in initial quality by an average of 10 percent, compared with 2008, surpassing the 8percent rate of improvement by the industry overall. Imports still garnered the most segment awards from Power, but the IQS shows that the quality gap is still closing between domestics and imports, and things are moving in the right direction for Detroit. This is pretty remarkable considering the miserable, nightmarish condition of the industry the past two years. For quality to continuously improve speaks volumes about parts suppliers, assembly line workers, the factories where they toil and the stylists, engineers and designers who have all come up with some of the best cars and trucks the marketplace has ever seen. 2010-07-02-2010fordtaurusshofd580op2.jpg All new Taurus Ford won three of the IQS segment awards, the Mercury brand one. Ford's unique Edge tied for first place with Chevy Trailblazer and Toyota 4Runner in the Midsize MultiActivity Vehicle segment. In the Midsize Sporty category, Ford's 2009 Mustang got the highest marks and in large pickups, the ubiquitous Ford F-150 took home the top honors for the Dearborn, MIbased car maker. While Ford did best among the domestics in the 2009 IQS, another announcement they made this past week also spoke to the company's recent success. That news was Ford will pay about $3.8 billion in cash to a union health-care fund, a sign the automaker is confident that CEO Alan Mulally's focus on the namesake brand will produce profits.

Ford sales rose 13% in June of this year over June, 2009. There are signs, though, that consumer confidence may be getting shaky again and the industry overall might be in line for another recession-based loss of sales and profits. But in the meantime Ford is flying relatively high, and it's not just all about the product. 2010-07-02-2011fiestaford.jpeg 2011 Ford Fiesta In late 1989, Ford paid nearly $2.5 billion to acquire Jaguar, then a long-suffering car maker whose future looked none too bright. Legendary poor quality had dogged Jaguar for decades, and they didn't have the money or the technology to make a fresh start with all-new models. Ford also bought Aston Martin (1994) and Range Rover (2000). All three companies improved in quality and customer service after their purchase, though a friend of mine still describes Range Rover interiors as looking like "an unfinished high school metal shop project". In fact, in one of the first Power IQS surveys in the early '90s, Jaguar was named the top brand in the world based on its improvement in the study, while the company had been near-last before the Ford purchase.

Power does not test cars; it uses registration rolls from every state to survey a set amount of owners of most all makes and models sold in the U.S. For this IQS, Power says they just spent nearly six months sifting through more than 80,000 surveys conducted with verified owners of 2009 model year vehicles. Ford's Fusion line-up (which includes a hybrid), the all-new Taurus and Euro-bred Fiesta and of course that F-150 truck are keeping Ford on the up side. Creative marketing (such as their tie-in with American Idol and the company giving new models to under-30 types before they're on-sale) have also been top drawer, currently some of the best in the business. Ford had one other win in the Power IQS. That was the Mercury Sable, the gussied-up version of the Taurus. It won in the Large Car segment, gaining traction with the 2009 model from 2008, when it placed second in class. Of course the irony is that Ford has officially killed their Mercury division, slating it to be gone within the next two years. RESOURCES: