Ford Motor Company: Supply Chain Management and Strategic Fit

Topics: Automotive industry, Ford Motor Company, Revenue Pages: 11 (3655 words) Published: January 14, 2014
Ford Motor Company
Supply Chain Management and Strategic Fit

University of Arkansas
Fall Second Session 2011
Supply Chain Management for Operations Managers
Written by: Albert Carter
For: Instructor Nia Wright
December 9, 2011
Abstract
This report covers the performance of Ford Motor Company over the past 10 years and analyzes the results of its “One Ford” business plan. The main question this report answers is whether Ford’s resent actions match the supply chain strategy of the new plan. There is also a short comparison between Ford and it closest competitor in the United States, General Motors. Data was collected from different sources such as, annual and quarterly reports, company websites, organizations such as the United Nations, along with independent sources. This data was review and non-financial and financial computations were performed to see it if Ford’s overall performance had improve since the implementation of “One Ford” and the assignment of new management. The results show that the company has made improvements to it performance both financial and quality based off forecasting, employee efficiency, contribution and cost margins, net income, and higher prices demanded for their products. Table of Contents

Industry Overview
In their industry report, First Research (2011) describes both the United States and global automobile manufacturing industries. The industry in the United States is comprised of about 200 companies . In 2010, two of the larger manufactures, Ford and General Motors, had combined annual revenues of approximately $235 billion & . The automobile manufacturing industry is a global industry with players from several major countries. Some of the larger global companies based outside the United States include Toyota (Japan), Volkswagen (Germany), Hyndai (South Korea), Peugeot (France), Fiat (Italy), and SAIC (China) . Although these manufacturing companies are foreign based a few have manufacturing facilities inside the United States. Some of these include Honda, Nissan and Toyota . While other manufactures have facilities here in the United States, Ford and General Motors have located facilities in other countries. Companies that locate facilities in foreign countries are attempting to maximize profits by taking advantage of lower labor costs, locate near suppliers and customers, and lower tariffs and other taxes. There are other challenges that are faced by the automobile manufactures besides the distance between their facilities and customers. These challenges include world economic conditions, fuel prices, regulatory standards, and the amount of loanable funds available to consumers . To combat macroeconomic issues such as these, firms must find other ways to increase profitability. Ford Motor Company is one of the automobile companies that has been able to do just that. Ford Motor Company Brief Overview, Products and Services

The following information was compiled from Ford Motor Company’s 2010 Annual Report (2011) and www.Ford.com. Ford Motor Company manufactures and distributes automobiles across six continents, employs about 164,000 people at approximately 70 plants. The major bands manufactured by Ford Motor Company are Ford and Lincoln. Ford Motor Company also owns approximately 30% of Mazda that is located in Japan. Besides automobiles, the company also sells parts and offers financial and repair services for their products to the consumer. In its car segment the Ford brand offers economical and sports cars, and a sedan. The economical cars include the Focus, Figo, Fiesta, and Fusion. The sports car and sedan are the Mustang and Taurus, respectively. MSRP of these cars rang from just over $13,000 to almost $26,000. The SUV and crossover segment includes the Escape, Flex, Explore, Edge, Kuga, Expedition, and the EcoSport. MSRP for these two types of automobiles from Ford ranges from $21,000 to $38,000. Ford brand also has a truck line that includes the...

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