...Chapter 5 Case – “Ford Motor Company” Instructor: Professor Pamela McLaughlin Course: Management of Concepts – BUS 302 Date: July 17, 2011 * This case outlines 4 strategic options Ford is pursuing to increase its profitability. Describe each of the 4 options. For each option list 2 criteria you would use to evaluate the option. The four strategic option that Ford Motor Company might pursue to increase its profitability is to (1) close down older plants in an effort to realign production and sales, (2) move the company to produce only smaller cars, eliminating or sharply reducing the SUV and truck lines, (3) take a dramatic step of dramatically reducing their North American presence and focus their efforts on international markets where they have been very successful, and (4) sell the entire PAG group, letting someone else figure out how to make money selling so few vehicles a year (Case Study, para. 3). When looking at any strategic plan, one needs to identify the decision criteria. Decision criteria are the standards used to guide judgment and decisions, states Chick Williams in Management. Naturally, the more criteria a possible solution meets, the better that solution will be. Two of the criteria that Ford would need to consider if taking the option to close down older plants would be, buying out workers (severance agreement) and dealing with the political implications of a closure. A buy-out agreement results from the collective bargaining process between...
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... Summary: The year 2005 is not good for General Motors. The company face loss $286 million in the second quarter and over $1billion in the first quarter. GM losses are largely tied to be North American operation and rising supply, fuel, healthcare, and pension costs. GM makes money not on auto sales auto financing.GM is overly dependent on the U.S automobile market; more than two thirds of its sales are made in the United States. In addition it is overly dependent on its financing division. GM facing economic threats at home and abroad and stiff competition from more differentiated and lower priced products, GM manager must decide how it will produce and market its vehicles in the future. EXECUTIVE SUMMARY: This paper will explain GM’s most pressing challenges. Overcapacity is negatively impacted their financial results, brutal international competition is causing GM to react with target costing strategies, rising fuel prices directly impacts their cash flows and complicates capital budgeting strategies and tactics and their ongoing health care and pension costs continue to color their future earning potential. These challenges will be addressed by using performance assessment measures. The financial assessment measures include net income and their market share value, liabilities of health care and pension benefits, revenues, target costing and capital budgeting. Non-financial measures include customer satisfaction and branding effects on sales volume...
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...HYUNDAI MOTOR INDIA LTD Hyundai Motor India Limited (HMIL) is a wholly owned subsidiary of Hyundai Motor Company (HMC). HMIL is the largest passenger car exporter and the second largest car manufacturer in India. It currently markets eight passenger car models across segments -- in the A2 segment it has the Eon, Santro, i10 and the i20, in the A3 segment the Accent and the Verna, in the A5 segment Sonata and in the SUV segment the Santa Fe. HMIL's fully integrated state-of-the-art manufacturing plant near Chennai boasts of advanced production, quality and testing capabilities. HMIL forms a critical part of HMC's global export hub, it touched 1.5 million in exports in March 2012. It currently exports to more than 120 countries across EU, Africa, Middle East, Latin America and the Asia Pacific. HMIL has been India's number one exporter for seven years in a row. To cater to rising demand the company commissioned its second plant in February 2008 having an installed capacity of 330,000 units per annum. To support its growth and expansion plans HMIL currently has 346 dealers and around 800 service points across India. In its commitment to provide customers with cutting-edge global technology, HMIL set up a modern multi-million dollar R&D facility in Hyderabad. The R&D centre endeavors to be a center of excellence in automobile engineering. Mission To create exceptional automotive value for our customers by harmoniously blending safety, quality and efficiency...
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...Thibault Kerstenne Nola Munster Diana Nguyen Kathy Academic year 2014 -2015 What other cars to introduce? Lower end of the market? Regarding the highly saturated lower end of the market, the launching of an ultra-cheap car does not seem to be the best strategy. Indeed, Suzuki and Hyundai are already major players on this segment. Moreover, Tata Motors, a well-established Indian manufacturer, announced the cheapest car in the world. Upper end of the market? Again, the competition is already struggling on this segment: GM, Toyota, Ford and Honda are already well represented on this market 1 . Although it is becoming more and more attractive due to the higher number of rich Indians, it seems dangerous to try this market regarding the strong competition. Our recommendation is therefore to invest in the middle end of the market. The reasons are growth opportunities and non-saturation of this segment. First, adapting the car to the local needs of the market is a priority, especially for India2, where mastering the local culture is a requirement. The features of the car would be the following: 1. The length of the vehicle should not exceed 4 meters due to tax measures (24%)2; 2. The style should be sportive, regarding the disastrous state of Indian roads and the trend of SUV (Sport Utility Vehicle) in India3; 3. The price of the car should be competitive. First, SUV cars are only sold by luxury brands4. Secondly, despite the wages’ rising, average salaries are still very low5. 4....
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...& Silvio, were stopped at a traffic light and a truck that was driving over the speed limit “rear-ended” the SUV in which the New Jersey residents were traveling. The truck contained fireworks for a local fireworks company, two of the residents were injured and hospitalized, and the car was totaled. The case was brought to the federal court because the damages experienced by parties were done in another state, New York. A truck owned by “New York Domestic Corporation” did the damages. The domestic company was preparing for a national holiday. This case was brought to the federal court because it involved New Jersey residents trying a New York State company. The plaintiffs wanted to hold the company and NYC liable for the damages experienced. Under “strict liability”, the defendant is guilty because of the negligence on the truck driver’s part. It is stated under strict liability that damages caused by “ultra hazardous” activity can result in harm even when the person “used the utmost care”. Here, the truck driver was not only driving with hazardous fireworks but also caused 2 of the plaintiffs to be hospitalized and the car to be totaled. The driver was not cautious of the speed limit set by the state of New York for the safety of its citizens. Therefore, The Fire truck company is liable for the damages and ordered to pay the hospital fines and for damages done to SUV. A New Jersey...
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...popular of the Car coming out of Ford Motors is the Mustang, to the large scale manufacturing of using moving assembly lines show us how Ford Motors has been setting standards in the fields of innovation and quality. For CEO Mr. Allan Mullaly in a statement given to the contact magazine said that one of his for priorities in the ONE Ford plan is "accelerate development of new products our customers want and value." This does not seem to be a surprise as now in the market lies in the customer's hands where he would want the best of the line of products and for the cheapest price. And in this era where the growth in globalization is sky rocketing it is the sole aim of car manufacturers to grab customers towards their business or they might end up closing their company. The proof of Ford receiving the more awards from J. D. Power and Associates for the surveys in initial quality for five cars, which no other automobile manufacturer has achieved till now, shows us how well planned the marketing strategy of Ford Motors is. History of Ford Motor company Founder: Henry Ford 20th century Henry Ford's first attempt at a car company under his own name...
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...April TRAINING EXECUTIVE EXECUTIVE BUSINESS SIMULATION MARKET RESEARCH MARKET RESEARCH PACKAGE FOR THE EUROPEAN PASSENGER AUTOMOTIVE INDUSTRY 2009-2010 Release 9 MARKET RESEARCH MARKET RESEARCH PACKAGE FOR THE EUROPEAN CAR INDUSTRY THE EUROPEAN CAR MARKET The European motor industry is the world's largest car market, having exceeded the US market in total units sold (excluding light trucks). It is also an extremely competitive arena. Some of the patterns to emerge from this market over the last few years are listed below. 1. Sales Figures1 Historical and Current The last strong rise in sales was in 1998 (14.3m), continuing into 1999, however, in 2000 sales fell by 2.2% (14.7m) and stayed at this level in 2001. In 2002 sales fell by 3%, 2003 saw an increase of nearly 5% but this was a result of an expanding marketplace, in reality there was another fall of 1% when comparing sales in the same EU member countries. 2004 saw a genuine 2% increase in registrations, remained stable in 2005, showed a substantial 4% rise in 2006 but then the percentage increase dropped to 1% in 2007. In 2008 European car sales figures were easily the worst for over a decade: 14.6m in extended Europe, 13.6m in the core economies, a drop of 8.2% and 8.1% respectively over 2007 figures. Gloomy forecasts for 2009 proved to be well founded with the whole market falling by a further 0.7% to 14.5m, however, the market excluding the new EU countries did show a 0.7% improvement to 13.7m...
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...run into a few problems with its strategy including poor reviews for quality of the new X-type, production that far exceeded demand, and aggressive pricing that may adversely affect the brand image. However, the core strategy is sound, and we would like to recommend the following: • Maintain autonomy of Jaguar unit to ensure differentiation. • Continue to offer high value to price features while improving production problems to attract customers and leave a luxurious impression. • Pursue growth in line with demand to limit discounting and sales based on price. If these measures are enacted, Jaguar will be successful in increasing sales volume, attracting new, younger customers and maintaining its brand image. Introduction Towards the end of World War II, Sir William Lyons began building the first Jaguars. Since that time, the distinctively British automobile has been synonymous with style, elegance, and impressive performance engineering. In 1989, Jaguar was brought under the Ford Motor Company umbrella, and this brand now also strives to be”…(an) excellent value for money for that level of luxury car.”1 A key component of this new strategy is the introduction in 2001 of the X-Type into the low-price luxury vehicle segment. This decision was viewed by many analysts as a huge shift from Jaguar’s historic positioning and had the potential to greatly undermine the Jaguar brand. However, BMW and Lexus...
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...Hybrid Cars IQP A Study on Hybrid Cars: Environmental Effects and Consumer Habits An Interactive Qualifying Project to be submitted to the faculty of Worcester Polytechnic Institute in partial fulfillment of the requirements for the Degree of Bachelor of Science. Submitted By: Michael Beliveau James Rehberger Jonathan Rowell Alyssa Xarras Submitted to: Submitted: 28 April 2010 Project Advisor: Prof. Chickery Kasouf 1 Hybrid Cars IQP Table of Contents List of Figures ................................................................................................................................................ 4 Abstract ......................................................................................................................................................... 5 Executive Summary ....................................................................................................................................... 6 Chapter 1. Chapter 2. Introduction .......................................................................................................................... 9 Literature Review ................................................................................................................ 12 2.1 Environmental Effects ....................................................................................................................... 12 2.2 Emissions ............................................
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...Economy Anonym PESTEL-Analysis of BMW Seminar paper Bachelor Business Administration Seminar paper Strategic Management Topic: PESTEL-Analysis for BMW Course of studies: Business Administration Table of Content Table of Content ............................................................................................ I Table of Figures............................................................................................ II 1. Introduction ........................................................................................ 1 2. Automotive industry in the 21st century ........................................... 1 3. PESTEL Analysis for BMW ................................................................ 2 3.1 Political ................................................................................................. 3 3.2 Economical........................................................................................... 3 3.3 Social ................................................................................................... 4 3.4 Technological ....................................................................................... 5 3.5 Environmental ...................................................................................... 6 3.6 Legal .................................................................................................... 7 4. Conclusion...
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...PA203 Interviewing and Investigation Unit 3 Assignment: Draft Interview Questions In January, 2002, Bill and Hillary were driving on a country road in Chappaqua, New York, when they were struck head-on by a snowplow. At the time of the accident, visibility was low and both the snowplow and the SUV that Bill was driving were traveling at low speeds. As a result of the accident, Bill suffered a fractured vertebra, a broken arm, and multiple tears along his back and shoulders. He also received cuts and bruises on his face. Bill has accumulated many medical expenses since the accident and now he is bringing an action against the county and state for his injuries, lost wages, and loss of consortium. Your firm has been retained to represent Bill. By the time you enter the case, Bill is back to work, and he is hard at work finishing up his memoir. He is continuing to incur medical expenses. However, some of the charges have inadvertently been charged to his HMO plan rather than being held out for payment as related to the litigation. You have been asked to calculate the medical expenses and manage the billing of the services. You contact the doctor’s office for Bill’s medical records (with his permission and HIPPA consent) and the billing statements. You also contact Bill’s HMO and ask for their records of services billed. While you await the medical records from one of Bill’s doctors, you decide to do some sleuthing regarding the “typical” costs for various services related to the...
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...Global Automobile Industry: Changing with Times By Chithra Gopal R.S., M.Sc (Agri) Executive Summary From a humble origin as a ‘horseless carriage’ manufacturing industry dating back to 1890s, the global automobile industry of 2006 has come a long way emerging as market leader in manufacturing activity, providing employment to one in seven people, either directly or indirectly. Hailed as the ‘industry of industries’ by the Management Specialist, Peter Drucker, the automobile industry (US) set standards in manufacturing activity by contributing mass production techniques during early 1910s. The Japanese soon followed by offering lean production techniques in the 1970s. Riding high on economical revival in many developing countries in Asia and Europe, the industry’s global output touched 64.6 million vehicles in 2005. But with a downward slide in market share, the Big Three was fast losing their dominant position to Toyota, Honda, and Nissan, thereby setting the ground for the emergence of New Six. Meanwhile UK, served as the single largest customer for European auto-makers. Japanese players were the leaders in the light vehicle market and hybrid market. China and India attracted the attention of global auto-makers, vying for setting up a cost-effective export base for meeting the demand from Asian markets. Despite government controls, Chinese market boasted of sales of more than 2.7 million commercial vehicles in 2004. With reports of highest growth in mobility in the world at...
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...Hierarchical Analysis of Industries Classes, categories, forms, brands Product hierarchy is a term which defines the way a product is relative to other products in the same industry. It guides the path and process a consumer takes to determine the products we choose and we eventually purchase. To start off we look at a basic need that our ultimate choice serves. After we identify the need and determine which industry will satisfy it we are faced with decisions. Which class of products in that industry will deliver that type of product? The different classes all serve a need that is relative to each other but may not serve the specific need. This is where we identify which category of product we are looking for. Here we will find products that serve similar functions and may be marketed to the same customer groups. To further narrow down our choices we must then select a product form that may serve a specific function. This is where we find the exact product that fills the ultimate need. Finally we make our end choice by choosing the brand of that product that will purchase. The actual number of levels in the hierarchy depends on how much more detailed or defined the need is. For example if someone wants soap and their only need is to clean something generic, they wouldn’t dig deeper into the types of soap they are looking for rather than looking for a specific type of cleaning agent for granite counter tops for example. To further explain and give examples of how a...
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...Leading People- FCA Company and SWOT Robert McCormack Western Governor University Author Note This paper is being submitted on August 30, 2015, for WGU C200 Managing Organizations and Leading People Managing Organization and Leading People- FCA Company and SWOT The Corporate American dream is undergoing a major overhaul. Not all that long ago there was plenty of opportunity for the average American worker to obtain employment in the automotive industry and earn what was considered a competitive wage. The internal and external challenges for the FCA LLC (Fiat Chrysler Automotive) company in recent years have caused the company to take on a systematic approach to building and maintaining a profitable business. The discovery of the root cause for the FCA turn around can be found in the leader CEO Sergio Marchionne. In the paper, we will review his top three leadership practices, and perform SWOT analysis of the FCA- North America organization. The FCA- North America LLC has its headquarters in Auburn Hill, Michigan. The FCA- North America divisions include SRT, Dodge, Chrysler, and Ram. The primary products made by this company are SUVs, trucks and automobiles. The Dodge autos include the Dart, Challenger, Charger, and the Avenger. The Chrysler autos include the 200, the 300, Town and Country. The Ram Truck line includes Ram 1500, 2500, 3500. The SUV lineup is Jeep, Dodge Durango. The FCA- North America LLC product has a target of the general public as well...
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...PRELIMINARY NOT FOR QUOTATION Increasing Global Competition and Labor Productivity: Lessons from the US Automotive Industry MCKINSEY GLOBAL INSTITUTE Martin Neil Baily Diana Farrell Ezra Greenberg Jan-Dirk Henrich Naoko Jinjo Maya Jolles Jaana Remes November 7, 2005 Preliminary Not for quotation 1. Introduction Increasing global competition is changing the environment facing most companies today. As trade barriers fall and transaction costs decline, new global competitors are entering previously more isolated domestic markets. In response to this intensified competitive pressure, local companies are pushed to enhance performance by innovating and adopting process and product improvements. This domestic sector dynamic leads to higher productivity, which, in turn, can create sustainable competitive advantages for companies, as well as being the most important driver of job creation and per-capita income growth for the economy. This link has been established in McKinsey Global Institute’s extensive country productivity research. Our new study goes further than previous research by focusing on how increasing global competition leads to productivity growth, using the US automotive manufacturing sector as a case example. More specifically, we have focused on the production of new vehicles in the US, including parts assembly. We have chosen this example because of the globally competitive nature of the automotive market and the size of the US...
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