Essay on Ford Competition

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In a present day of global warming, environmental issues, labor unions, and other impacts, the automobile industry is in an era of instability and change. Ford Motor Company has been traditionally considered one of the "Big Three" in the auto industry, but they are not adapting as well as hoped to the changing industry, and will have to strategize to survive in a struggling industry.

There are many different risk factors for Ford and its competitors. In this paper we will look at two competitors for Ford that are also considered to be members of the "Big Three" and coincidently, are not adapting to changes in the auto industry as quickly as other competitors. These other companies are General Motors (GM) and Daimler Chrysler. We will
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Ford feels that although steps have been taken to lower their health care expenses, the cost to the company will continue to rise for the foreseeable future. Foreign car manufacturers have on average lower health care and employee costs, giving them an advantage over Ford, GM, and Daimler Chrysler. Ford Motor Co is hoping to take steps to offset the costs of employee benefits; however, this could also lead to negative publicity for the company. Foreign auto makers are able to maintain lower costs with non-unionized and on average, younger employees.

The next risk factor for the auto industry is commodity and energy price increases. Steel and resin (plastic) are the two most used commodities for auto manufacturers, and they are products in high demand for many industries. Rising awareness of sustainability and rising demand for these products has lead to recent price increases, and it is estimated to continue this trend. This factor targets all of the auto industry, but again hits the big three and other auto manufacturers harder then it does some of the foreign car manufacturers. Japanese auto makers have long been seen as efficient smaller car manufacturers, where the "big three" have moved to the larger SUV type vehicle. By building smaller vehicles, Japanese auto makers reduce their dependency and therefore their costs on steel and resin. The second risk coming from the comparative sizes of vehicles being manufactured by the auto makers is the cost

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