Ford Case

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School

University of Alabama *

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490

Subject

Business

Date

Apr 3, 2024

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docx

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3

Uploaded by danielw3lch

Daniel Welch Ford Case GBA 490-322 1. Competitive Rivalry- High. The industry is intense between the established companies. They compete on innovation, fuel efficiency, and price. Threat of New Entrants- Low. There are expensive barriers to entry. New entrants cannot compete on price. Threat of Substitute- Moderate. Public transportation or alternative modes are substitutes but the industry has adapted well through electric vehicles and continuous innovation. Buyer Bargaining Power- High. Buyers have a wide range of options and can compare each product. Brand loyalty is big in this industry. Supplier Bargaining Power- Moderate. Large automobile makers have long-term relationships with suppliers and can pressure them on price. Suppliers of crucial parts have higher power than suppliers of parts with less importance. Technological Innovation, Regulations, Consumer preference, globalization, supply chain negotiation, and conditions of the economy are the drivers. 2. Strengths Strong Global Presence- operates in many countries with diverse markets. Portfolio- Ford offers a diverse catalog of products with trucks, SUVs, and electric vehicles. Weaknesses Dependence on the U.S- this limits its revenue in emerging markets Image- Ford’s reputation has been declining due to product recalls and discontinuations. Opportunities Electric Vehicles- These are growing in demand and Ford has the resources to expand into the market. Innovation- New technologies such as self-driving vehicles have yet to be perfected and present an opening. Threats Competition- Both from established manufacturers and newer entrants like Tesla
Regulations Economic Stability 3. Primary: Logistics- Receiving, warehouse, distribution of materials, delivery to dealerships Operations- the manufacturing process, assembly lines, quality control Marketing- promoting, pricing, and selling vehicles. Advertising and dealership deals as well. Service- Vehicle maintenance, repairs, or customer support after the sale Support: Suppliers: building relationships for quality deals for materials and parts Development- technology research for innovation HR- improving the workforce through training and management Infrastructure- company systems and facilities 4. Gross profit is declining as well as operating profit margin and net profit. These are all approaching zero. ROA and ROE declined as well approaching zero. The current ratio has stayed constant along with working capital. Ford can cover current liabilities adequately. Debt ratios are both high meaning they are too reliant on debt and equity. The coverage ratio fell from a sufficient ratio to a low ratio. This raises concerns about the company’s ability to cover interest expenses. 5. Adapting to electric vehicle trends Cost Management Accessing new markets Brand Image 6. Ford needs to prepare for the electric vehicle wave. They have announced models but need to put more emphasis on improving these vehicles to a quality above the competition. Ford is not managing their costs well. Making a change in this management area is crucial for profitability to increase. Accessing new markets can be achieved through partnerships with vehicle-based companies like Uber, or simply entering business with new countries. Brand
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