Opportunity Analysis for FORD

Question: Discuss abut the Report of Opportunity Analysis for FORD. Answer: Introduction in this assignment, a market plan for the company Ford has been developed. In this part of the assignment, various analyses have been done on the company Ford like macro environmental analysis (PESTL) and micro environmental analysis (company analysis, competitor analysis and SWOT analysis). Depending on the outcomes, the marketing objective of the company has been developed (SMART objective). Company Background . The Ford Motor Company is an American Multinational carmaker. The company headquarter is located in Dearborn, Michigan (Sha, Huang Gabardi, 2013). The key products of the company are such as Luxury Vehicles, automotive parts and Commercial Vehicles. Main service of the company are like Automotive finance, Vehicle leasing and vehicle service. The total revenue of the company is approximately US$ 149.5 billion until 2015 (Khanna Palepu, 2013). There are more than 199,000 employees are working in the company. . Henry Ford founded the company on November 2, 1901. At first the company was known by its owner name Henry Ford. In the year of 1902, it became Cadaillac Motor Company (Abdulsater et al., 2014). Between 1903 and 1908 the company had produced Model A, B, C, F, K, N, R and S. In the year of 1908 the company had produced one of its mass-produced car Model T. The model Ford Mustang was produced in the year of 1964 (Hawken et al., 2013). In the year of 1965 the company introduced seat belt and reminder light. Presently the company is one of the most renowned car manufacturers globally. Situation Analysis Market Analysis From a survey analysis, it has been found that there are more than 73 million vehicles during the year of 2015 (Propfe et al., 2013). China and United States are counted as the largest automobile markets globally. United States has become one of the key players of the automotive market when the company Ford introduced a mass-manufactured car Model-T (Hamel Breen, 2013). Currently the most popular car model is Ford Focus. It was recognized as the car of the year globally. The top 5 car models in term of revenue are Volkswagen, Toyota, Daimler, General Motors and Ford. From survey analysis, it has been found that international car sale per year is 72.37 million (Bohnsack, Pinkse Kolk, 2014). Macro Environment Analysis Political Analysis Technical innovation is highly supported by government (Opportunity). The company can use the governmental incentives to improve its activities like innovation, sustainability and development government friendly products. The company has the opportunity to expand its business operation depending on the trade agreements (Bergek et al., 2013). (Opportunity) In developing countries like U.S. and China, the governments have increased their effort to improve infrastructure (Opportunity). Economic Analysis The company has the opportunity to increase its market depending in U.S. It can utilize the slow but steady growth of the economic condition of the company (Chevalier Mayzlin, 2012). The company can use the high growth rate of other developing countries like China and expand its market. Strengthening of U.S. dollar is a major economic threat for the company. As Hawkins Gausen and Strmman (2012) stated that, most of the raw materials for the company Ford are produced in United states due to the government support. However that company needs to increase its business efficiency in order to maximize its business opportunity foreign market. Social Analysis As Hamel and Breen (2013) mentioned that, peoples are becoming more interested towards electric and hybrid cars. Ford can take this opportunity and attract new segments of customers. The company also has the opportunity to improve its customer service. However, the increase of wealth gap between people can act as both threat and opportunity for the company (De Mooij, 2013). The intensive growth strategy of the company needs to emphasize on product innovation so that it can satisfy all the preferences of customers. . Technological Analysis Increase of mobile computing is an external factor that can create opportunity for the company to increase its mobile marketing activity (Fleming, 2013). The company has the opportunity to improve its business performance with the help of online fulfillment services. For instance, the parts of Ford cars can be delivered to the customers with the help of these fulfillment services (Hamel Breen, 2013). However, Hardman Shiu and Steinberger-Wilckens (2015) stated that limited availability of alternative fuel stations is a major threat for the company Ford as the company is developing more hybrid cars and electric cars recently. Legal Analysis The company Ford can improve the sustainability by addressing the environmental protection regulation. As Hawkins Gausen and Strmman (2012) mentioned that, the company can enhance its product design in order to take the opportunity of the safety regulation. Increase of intellectual property laws can improve the macro environment for the company. Micro Environment Analysis Company Analysis Ford develops cars that are affordable and reliable (Chevalier Mayzlin, 2012). The company has strong internet presence. There are more than 199,000 people works in the company. They buy Ford cars.. The company has issues related with labor union. Work is dangerous, low-skilled, boring and created low morale (Sha, Huang Gabardi, 2013). In the company, women can get bonus only if they are single. Men can get bonus only if their wife do not work. The company Ford has strong brand recognition. It has the maximum profit per unit of car selling in U.S. market. However, the company is presently facing intense competition from companies such as like Honda, Toyota and Nissan. Competitor Analysis The four major competitors of the company are such as GM, Toyota, Chrysler and Honda. Point of Similarities (POS): Both the company GM and Ford were founded during the same period. Ford was founded on 1906, on the contrary GM was founded on 1908 (Fleming, 2013). Both the companies have strong history. Chrysler, Ford and GM have headquarters in Michigan, USA. All of these companies are mainly U.S. market centered. Point of Differences (POD): The major difference between the companies is related with core competencies. As Chevalier and Mayzlin (2012) stated that GM mainly focuses on innovation in technology and service. Toyota focuses on total quality management (TQM). On the contrary Ford focuses on innovation in safety, technology and design. Competitive market Summary Competitor Target Market Positioning Product line Price (USD) Promotional Distribution GM Young Adults Stylist and affordable Escalade, CTS-V, XTS crossover 13300- 17420 Magazines, TV, internet All USA Toyota Young Adults Sporty and High-tech Yaris Sedan 3 Door Hatch 5 door Hatch 12900 - 13700 Internet cable TV, Syndicate spot TV All USA Chrysler Young Adults High quality and fuel efficient 14100- 17400 All media All USA Honda Young Adults Urban Sporty Fit sport Fit sport w/Nav 14100- 19240 Network, internet, TV All USA Figure 1: Competitive market summary (Source: Chevalier and Mayzlin 2012) Consumer Analysis Mainly young peoples and ladies like to buy Ford cars (Fleming, 2013). Young people who belong to the age group of 20-25 years of age with average income can afford to purchase cars of Ford. They mainly like to buy some specific models of Ford such as Ford Fiesta and Ford Focus (Sha, Huang Gabardi, 2013). Some young males also like have a Ford Mustang in their garage. They mainly like to purchase car offline. These types of models are liked by most of the young age people as these cars have only 5 seats (Hamel Breen, 2013). These types of car are not for big size family. In addition, all these models are available at an affordable price. SWOT Analysis Strength Ford is the second largest industrial corporation in the world. The company has more than $144 billion revenue. The company has strong history (Fleming, 2013). Ford already has strong internet presence. Ford has most profit per vehicle compare to other car makers in U.S. Weakness Overcapacity is the major weakness of the company. As Hamel Breen (2013) stated that, the IT knowledge is low in the lower tier of the supply chain of Ford. Poor forecasting of demand Average delivery time is higher (45 to 65 days) Opportunities The company has 2000 restructuring plan. Ford has the opportunity to improve its global presence. The company can improve its internet presence. Ford should try to improve its retail network. As Chevalier and Mayzlin (2012) stated that, Ford dealers should stop competing with each other within a specific region. Threats Increase in competition with foreign car making companies like Honda, Toyota and Nissan (Sha, Huang Gabardi, 2013). As Fleming (2013) stated that, presently developing countries focus on manufacturing their own automobiles. Presently smaller companies with fewer assets have greater market capitalization than Ford. Figure 2: SWOT analysis of the company Ford (Source: Fleming, 2013) Objectives Marketing Objectives The major marketing objective of the company is to develop new products like (electric cars) that customers want and give value. Specific Due to environmental issues, peoples are becoming more inclined towards hybrid and electric car. Measurable Development of electric cars will increase the revenue flow for the company Ford. Attainable The company has access to all required resources for this project. Hence, this objective is attainable. Relevant With the increase of environmental issues development of electric and hybrid cars have become highly relevant. Timely The company will be able to develop electric cars within 1 year and launch it in the global market. Presently with the increase of environmental issues such as global worming preference of people about cars has changed. People start to like cars that cause less pollution such as electric cars and hybrid cars (Chevalier Mayzlin, 2012). Presently the company Ford is facing intense competition from companies like Toyota, GM and Honda. Hence, in order to attract more customers towards the company, Ford should try to increase product differentiation. 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