Internal Analysis:

BCG Matrix
BCG (Boston consulting Group) is based on market growth in portfolio analysis. BCG matrix is
use to prioritize opportunities and get the best return or company effort. Under this model. Ford
motor companys brand can be measured and valued properly. This helps to know the actual
position of the company.
Relative market share. One of the dimensions used to evaluate business portfolio is relative
market share. Higher corporates market share results in higher cash returns. This is because a
firm that produces more, benefits from higher economies of scale and experience curve, which
results in higher profits. Nonetheless, it is worth to note that some firms may experience the
same benefits with lower production outputs and lower market share.
Market growth rate. High market growth rate means higher earnings and sometimes profits but
it also consumes lots of cash, which is used as investment to stimulate further growth. Therefore,
business units that operate in rapid growth industries are cash users and are worth investing in
only when they are expected to grow or maintain market share in the future.
There are four quadrants into which firms brands are classified:

Star:
According to the BCG model the ford motor company is investing in the product line of cars as it
lies under the stars and its characteristics are as follows:
Cash flow:
Neutral flows relatively proceeding towards growth.
Earnings:
Low and possibility of growing in future.
Strategy:
For growth of cars in future, strategy should be to invest by firm.
Cash cow
Cash cow shows the high market share and low market growth rate. Here, ford motor company is
carrying SUVs in this segment of BCG matrix and its characteristics are as follows;
Earnings:
Earnings are high and stable as this product line is old and relatively more profit carrying.

Cash flows:
Cash flows of SUVs are also high and stable.
Strategy:
For SUVs fords strategy should be to maintain the stability of earnings and cash flows.
Question marks
Ford motor company have the low market share and high mix growth rate. Ford has super line of
trucks which is profit generating product line and hybrid EVs which is newly launched product
line and its characteristics are as follows:
Earnings:
Earnings are low and could grow in future if products sales increases.
Cash flow:
Cash flows are negative as these are the new product lines and for their growth ford has to invest
instead of generating profit from it right now.
Strategy:
As sale of trucks are increasing so, it needs to invest for its further growth and for hybrid and
EVs ford also needs to invest and if in case of some negative sales in future, fords strategy
should be to sell instead of investing in it.
Dogs
In these characteristics the market share and market growth rate is low. The product in this
characters market is existing for doing competition to the competitors products. Ford motor
company brand Jaguar and land Rover had faced the problem and connate generated profit at
2006, to early at 2008 but finally the Ford motor company sale the brand to Tata company on
2008 march. Ford motor company sales its brand or liquidate too solve the financial difficulties.

Competitive Advantage
Return on equity shows how much profit a company generates from shareholders' money. The
return on equity standout among the automakers is Ford. The other automakers are not as
effective in converting shareholder money into profit. Return on equity is a measure of
management's effectiveness, so I see this as an important metric and competitive advantage for
Ford's continued success. The return on equity is calculated by taking net income and dividing it
by the shareholder's equity.

ROE

General

Toyota

Honda

Volkswagen

Ford

Motors
13.27%

11.11%

8.39%

10.14%

28.5%

Product line is Satisfactory:

Product line is respected by industry experts and is qualitatively seen to be a step above many
of its competitors. Recent surveys place Ford in a tie with Toyota for greatest customer
satisfaction, a significant improvement from five years ago.
Fuel Efficient cars:
Ford has recognized the importance of small, fuel efficient vehicles and is actively
transitioning into this market. Of particular interest is Fords Eco Boost technology, which
the company claims will result in 20% greater fuel efficiency and 15% fewer CO2 emissions.

Fords truck line is still much profitable than others so, by increasing its production line
ford can increase its profitability.

Lowest Cost Production Efficiency:

Ford motors adopted the strategy that allowed it low production cost by cutting all the excessive
cost involved in this operations. The huge expenditure on raw materials was cut down and the
online manufacturing process was introduced that focus on the development of cars on one
process rather than having different segments of engineering and production. This strategy was

establishes cost advantage and give the company advantage over its competitors in terms of
lower cost, in the mean while company focused on producing smart cars that were not price
sensitive and offered the functionality of traditional ford cars.
Fully Integrated Communication System:
Ford SYNC is a company fitted, fully integrated communication and entertainment system that
connects the users with internet, through his smart phone and allows them to make telephone
calls and control music and other functions using voice commands. This system is the integrated
interface developed by ford and Microsoft that operates on Microsoft Windows Embedded
Automotive operating system which is also the competitive advantage of ford.
Organizational Culture:
Ford is second largest car manufacturer worldwide and widely known for vehicle service for its
customers. Large emphasis on customer first and customer satisfaction. Areas served are
worldwide. Currently Fords organizational structure is based upon the following points:
Aggressively restructured firm to operate profitably at current demand changing model mix.
Plans implementation:
Finance their plan to effectively improve their balance sheet and work cohesively for its
implementation.
Automotive leadership:
Work together as one team which emphasizes the importance of working together to achieve
automotive leadership, which is measured by their customers satisfaction level, employees and
other essential business partners.

People orientation:

Ford exhibits a culture that is adaptive in nature and the managers in company show care for
their clients, employees and stockholders.
Attention to detail:
Being a leading manufacturer, precision and reliability are the hallmark of fords products from
its employees.
Stability:
Low degree of stability as status quo has been put to stake many times in the past in favor of
innovations and boosting employees morale.
Innovation & Risk Taking:
Employees views are valued and frequent launch of new products exhibiting innovative features
depicts high degree of risk taking but Ford tries to go over it.
Organization Structure:
There is clear chain of president to vice presidents of different branches in different states which
is shown below in Fords organizational structure:

Sfas
Strengths

Weaknesses

Threats
Opportunities
Industry Information
Key success

Weig

factors

hts

Ford Motors
Rating

Weighted

General Motors
Rating

score

Toyota Motors

Weighted

Rating

score

Daimler Chrysler

Weighted

Rating

Weighted

score

score

Global

0.13

0.26

0.39

0.39

0.26

Expansion
Financial

0.11

0.33

0.44

0.33

0.33

Position
Growth
Market Share

0.13
0.15

2
3

0.26
0.45

3
4

0.39
0.6

4
2

0.52
0.3

1
2

0.13
0.3

Product

0.13

0.52

0.39

0.39

0.39

Quality
Customer

0.12

0.48

0.36

0.36

0.48

Loyalty
Models
Management

0.11
0.12

3
3

0.33
0.36

4
4

0.44
0.48

3
3

0.33
0.36

3
3

0.33
0.36

Experience
Total

Internal

2.99

3.49

2.98

2.58

Weight (0.0-1.0)

Rating (1-5)

Weighted Score

Comments

0.10

0.40

Ford has enough

Factors
Strengths
Brand
Recognition
Producing

brand
0.10

0.30

Hybrid Vehicles
Fuel Efficient

appreciation.
Ford is
producing

0.15

0.60

hybrid vehicles.
Fuel efficiency

Vehicles

is the most
demandable

Quality &

0.05

0.15

Safety
Customer

component.
Quality is not
comprisable

0.03

0.06

loyalty

feature.
Customers dont
switch because
of companys

Effective

0.07

0.14

products.
Distribution

distribution &

channels are the

Manufacturing

important

channels

component for
selling products.

Weaknesses
Sales are

0.15

0.45

decreasing

Overall
economic
recession has
burdened upon

Firing of

0.06

0.18

employees

sales.
Downsizing is
the end result of
economic

Increase in over-

0.05

0.10

recession.
Labor cost has

time wages

been increased

Decline in

in this recession.
Customer

0.10

0.20

customer service

services leads to
decrease in

Firms morale

0.05

0.15

empowerment.
Economic
recession or

decrease in
revenues has bad
impact upon
Decrease in

0.09

0.27

revenues

firms morale.
Decrease in
sales leads to
lowering
revenues.

Total

1.00

3.00

STRATEGIC RECOMMENDATIONS

Company needs to avoid from cash burn and needs to sustain the cash in order to avoid
bankruptcy in future. Frequent loss can make Company weaker in the market and in

reputation as well.
The bailout or money supply has made GM and Chrysler tough in front of Ford while
Ford is strategically stronger. These bailouts and treasury funds provided to the GM and
Chrysler can create a huge impact strategically on Ford. It will be getting easier to
mitigate the overall progress of the Ford. It can also create an impact on the overall

supply chain of the Ford.

Now Ford must trigger its 'One Ford' vision and continue to discriminate itself from its
rival firms that are GM, Chrysler and Toyota even as the economic recession goes away.
In recent years, Ford has redeveloped a rational corporate strategy. Ford has been rejected
to take the Government funding and other treasury money supply just because the
Company has gained the financial confidence. Whether to exploit the weaknesses of GM
and Chrysler, Ford needs to provoke some sound strategies for the company and look for
the bigger picture not on tiny picture that was of gaining maximum market share in this
industry. The reason behind this recommendation is that if Ford starts focusing on
customers needs they would gain maximum share price rather on focusing on rivals

weaknesses.
There are some steps that Company needs to follow immediately. We believe that
Company should be focusing on the short term objectives in order to survive for the year
2009 instead proposed years. We believe that Ford's management is on the right track, but

recent progress is uncertain and could easily degenerate given current market and
industry conditions.

Ford Should deprive Volvo:

In order to be truly operative and competitive, Ford should merge its Volvo into Fords
organizational structure and strategically from Fords other lines. Volvo is quite less expensive
than BMW and Mercedes and it targets upper-middle class consumers. The brand had potential
to provide Fords premium line of vehicles. According to the statistics, Volvo does not belong to
the one Ford strategy and the given conditions; we believe that the sale of Volvo should be
high priority of Ford. It can be predicted that the brand can generate at least 5 billion dollars and
this amount of money is on hand and Ford can satisfy some debt out of this sale.
In addition, Ford need to specifically target Volvo group which was Swedish parent Company
sold Volvo cars to Ford in 1999. Volvo did extra ordinary in Sweden regarding its sales,
employees along with its some subsidiaries. So we believe that Volvo should pursue Sweden
Government to support the repurchase of Volvo cars by Volvo Group. It would be possible for
the Swedish Government to provide some significant support for deal.
Volvos overall progress and worldwide makes the brand worthy and on the basis of this
reputation; Volvo would be welcoming by the consumers of US and Europe consumers. There
are several car manufacturing firms for the Volvo cars but people like Volvo on the basis of its
goodwill and image that have been created in the minds of the customers. So we believe that
Volvo should take the advantage right now and jump in to the market with potential and expected
growth.

Supply Chain Management Processes and Fords Factories

There is so much tilt that had been seen in shutting down the current plants including the
factories in the United States and Europe. We believe that instead of focusing on shut down these
factories, there is a need to improve the restructuring plants and factories in terms of
management and supply chain processes. Meanwhile Ford has to disconnect with the suppliers
which they have been contracted with more than 15, 00 suppliers. Ford must examine all of its
suppliers and identify those which are critical to the supply chain. These companies should be
prioritized above all others in the distribution of contracts.
Particularly Visteon was the major partner whom with Ford did 4 billion dollars business in
2008. Oasis Consulting is prepared to step in and undergo a complete evaluation of all 1,600
suppliers and present recommendations for specific reallocations of contracts. With access to
Ford's proprietary data and through an evaluation of the sources of these companies' contracts,
Oasis Consulting can ensure supply chain stability for Ford even in the direst of circumstances.
Prepare for Liquidation of Chrysler and/or Bankruptcy of GM
Ford should develop strategies for its rival firms (GM, Chrysler) if they will be going for
bankruptcy. Chrysler is going to deal with Nissan and Fiat. What if the deal would be cancelled
and what if Ford can make deal with Nissan for a joint venture. It can be done and it would be
more efficient for Nissan to deal with Ford rather Chrysler which is already in a very bad
situation. So we believe that Ford can break easily the deal of Chrysler with paying some a little
extra and can make a decent deal on the basis of current sustainable performance that Ford has
yet.
It is in an interest of the Government to avoid bankruptcy proceedings because the condition of
the Chrysler will definitely create such a great impact on GM. We cannot predict the future of
GM at this time. Whether GM reports a file of bankruptcy or not Ford needs to ensure that GM
is not made the national champion implicitly and explicitly. Part of Ford's strategy moving
forward must be to extensively lobby both Congress and the American people. Ford should
increase marketing its vehicles in order to gain the competitive advantage until a decision
regarding GMs future is reached. We recommend Ford to develop a consistency in consumer
queries regarding warrantees.

Product Differentiation
As we have been discussed so far that it may be difficult for Ford to develop long term strategies
where the industry is in severe crises and people have less buying power due to unemployment
and inflation so we recommend Ford to just concentrate and develop short term strategies as
Oasis consulting also believes that it is critical for Ford to continue preparing long term
strategies. One of the valuable short term recommendations, we believe that Ford needs to bring
some innovation in its vehicles. On the contrary, Ford should gain the ability to successfully
differentiate itself from its competitors through price and quality. One Ford strategy is viable
and efficient but we believe that it has some risks involved. First but not least risk is that we
believe that it may be over-pursued. Another major risk is that while we recognize management
was under pressure to affect change, Ford should not invest its future on one line of vehicles.
We appreciate for Fords investments in fuel efficient technologies and its recent development of
Ford Fusion hybrid. Unfortunately the arrival of Ford in this particular segment was late but the
company has succeeded in delivering a vehicle which is instantly competitive because of the
price and its quality. But in comparison with Toyota, Ford is at a disadvantage in this sector. It
has been exceeded its product variety that has a chance to redefine the competitive background.
Ford should be migrated its production to Mexico and Eastern Europe
According to the current situation, Ford is bearing too much labor cost in United States and
Europe for manufacturing its vehicles. Furthermore the currency of Dollar and European Pound
is kept on decreasing so we believe that Ford should be migrate its majority of production of
vehicles towards Mexico and Eastern Europe where the labor and production costs are quite
cheap. We can see the production of vehicles in different areas currently Ford has been involved
in production of its vehicles. Given below is the graph with a variable on y-axis for the number
of vehicles and the vehicles produced by region on x-axis.

But this strategy should be implemented slowly in years so that Ford would be able to avoid
from negative public relations and branding which may be surfaced. Ford should take care of the
sign that they have currently for its vehicles as American Car. These non-operational plants
that have been shut from 2006-2008 in North America now will be working well and there is a
chance to grow after taking place in Mexico. In 2007, Ford invested $88 million to acquire a car
manufacturing plant owned by the Romanian government and has also announced plans to invest
some $3 billion in manufacturing facilities in Mexico. We are hoping that these are the first steps
in a broader move in production towards lower cost labors.

By Expanding Market Share in China and India

China automobile market has experienced a consistent growth in the past ten years. It is stated
that over 9 million vehicles have been manufactured in the last year that was 2008. This industry
and market has a sound profitability. Ford did a joint venture in 2008 with Changan Automotive
of China. It is manufacturing some pretentious brands of Ford like Ford Focus, Fiesta and
Mondeo lines. It is estimated that this joint venture has been produced more than 200,000
vehicles in the past year. There is expecting a twenty percent increase in demand as the Chinese
Government has passed an incentive package. So we believe that there is a room for Ford to
increase the production of its units. We believe that this type of magnitude can increase the
market share of Ford motor Company and as a result when there are chances of bankruptcy and
liquidation, Company can expect to decrease down a fierce debt. Yet Ford has only gained a two
percent market share in China so by fulfilling the demand of Chinese consumers, Ford can gear
up the revenues from this particular market.
Ford Fiesta is the most likable brand by the audience in China and we believe that it can boost up
Fords market share. According to the past statistical data of sales, this brand has been
experienced a strong sales in China in year 2008. We hope that Fiesta should surpass the 100,000
units mark and boost Fords overall 2009 China sales. As the incentive provided by the Chinese
Government and ongoing difficulties of GM, Ford we believe can easily capture the market and
this is the best time to avail this opportunity for Ford to steal the market share and establish itself
as the dominant American brand in China.
Unlike China, India has a little growth opportunity for this automobile industry. It has been
stated that sales of vehicles were holding at two million over the past two years in India. So like
China, there is less chances for Ford to regain its strength in terms of gaining a huge market
share and price. Furthermore, Ford was needed a huge capital investment in India to setup
several plants if it wished to rise up production. According to the statistics, the monthly sales are
exceeded 2000 units and Ford has its dealership in just approximately 80 Cities of India. Due to
the magnitude of uncertainty, we do not recommend Ford to invest in India market at this time.
But we recommend that Ford should never ignore India market because of its intensive area and
this opportunity should be kept in Companys pocket or it can be used in defensive manner.