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Ford Motors Credit Company: Monitoring competitors’ Performance

12 April 2022

d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d Company’s overview

The Ford Motor company was founded in 1903 in Dearborn, Michigan. It is

esteemed as one of the top sellers in the automobile industry that offers commercial cars

under the brand name Ford while the luxurious vehicles are offered under the brand name

Lincoln. In the United States of America, it is considered to be the best automotive

manufacturer. At the global level, Ford holds the 5th rank. Most of the profits come from

North America for the company. It is a billion-dollar business in the world and here is a

comprehensive analysis in monitoring the competitors’ performance.

A comprehensive analysis has been carried out and resented in the report to

understand how organizations develop and manage strategies to function in the evolving

market landscape in the 21st century. Some of the key tools that have been used to perform

the analysis are SWOT analysis, Porters 5 Forces analysis, External Factor Evaluation (EFE)

framework, emphasis has been laid on opportunities and threats since they arise in the

external business climate.

Opportunities

The company strives to be technologically adaptive and this is good for they can

leverage this in producing fuel efficient cars and commercial vehicles. They can also try and

penetrate markets such as Asia or even emerging economies of smaller countries so as to

broaden their customer base. In the fast growing world of technology, the company has an

opportunity to do more digital marketing so as to grow its customer and supplier

interactions. The company can also look into venturing into an auto relate industry such as

rentals so as to diversify their portfolio.

Threats

The company has a very cut throat competition in companies such as Tesla and

GM and this puts them at a point where they could potentially lose their customers.

Another issue would arise in the high and increasing cost of raw materials which narrows

the profit margin. Due to the environmental agreements there have been increased

not sell well in the recent years as compared to the previous years. The table presented

d d d d d Threat of New Entrants:

Setting up an automobile company requires a huge sum of capital for the

infrastructure and distribution channels. This also leads to a point where the entry barrier is

set to a new high for those wishing to try a hand in the industry. As compared to its world

competitors, Ford has a well build brand name and years’ worth of relationship with their

suppliers and distributors which has given them an upper hand in the determining the cost

in the long run. This helps with cushioning their customers. Since the barrier for entering

this industry is too high, then the threat of new entrants is low. Thus, it can be said that

the threat that Ford faces from new entrants is low. The high level of uncertainty,

complexity and ambiguity that exists in the automotive industry further makes it challenging

for new entrants to enter into the market setting (Simonazzi et al., 2020).

The Ford Motor Company specializes in cars, trucks, and SUVs there are public

transport, bicycles, and bikes which can be substitutes. Electric vehicle can offer another

way in which the company can broaden their portfolio since most companies are

public transport. Also the infrastructure around electric vehicles is still developing hence

Ford offers various choices to its customers. Most of the customer base is the middle

consider an electric vehicle more than a fuel consuming vehicle. These factors give the

customers a high bargaining power. However, the products by Ford are different and

specific, also the customers are not in a position to produce what Ford offers on their own

by sourcing them direct from the supplier. This definitely lowers the bargaining power of

the customers. The bargaining power of customers depends on the availability of diverse

options in the automobile industry. Since there exist a large number of manufacturers in the

automobile industry, the customers have an advantage over the Ford business. They have an

option to prefer the vehicle of another brand if they are not satisfied with the offerings of

The company sources its raw materials from all over the world. Ranging from

Canada, to Japan Sweden and Colombia. This has given them an upper hand in that there

existing contracts. Also, the suppliers have no ability to produce what Ford is producing. So,

The global automotive industry grows continuously. Markets are very competitive

market share and faces competition only from companies like Toyota, Volkswagen, Honda,

Hyundai, Chevrolet, General Motors etc. Since the industry is capital-intensive, with a great

amount needed for establishing the company both infrastructural and in terms of distribution.

This brings about a high exit barrier for the competitors and there are no switching costs in

the part of the customer moving to the competitor. The threat from competitors is extremely

high in the automobile industry which increases the level of complexity for Ford (Nagy &

Jámbor, 2018).

Competitive Analysis - Three competitors

The three competitors of Ford that have been identified are General Motors, Tesla and The

Shyft Group. Each of the businesses has been showcasing robust business performance.

General Motors is a reputed American automotive manufacturing business that was founded

in 1908. It has been delivering value for the target market audience by focusing on

competition to Ford since it leverages innovation to produce electronic automobiles. The

The Competitor Profile matrix has been used as an important analytical tool to

companies dominate the industry and are aggressive in developing and marketing techniques,

making them worthy competitors. In terms of revenue, Ford Motors and General Motors

(GM) outcompete Tesla valued at 127,144,000,000, 122,484,000,000 and 31,536,000,000

respectively. According to (Mergent Online), the overall company size of Ford is the largest

among the three competitors, with over 186,000 employees. GM comes second in size with

155,000 employees, followed by Tesla (70,757 employees) and the Shyft Group company

with 3,000 employees. Ford company prides itself on its cutting edge design and technology.

Their innovation focuses on designing environmentally friendly and self-driving vehicles, a

business has planned to launch over 30 electric vehicles by the year 2025 by leveraging

digital technologies. Tesla's entrepreneur Elon Musk believes that the faster the world moves

from depending on and using fossil fuels, the better. The company specializes in electric

vehicles and clean energy and storage products. The Shyft Group is characterized by its

exceptional capability of combining in-depth industry knowledge, expertise in engineering

and manufacturing, and purposeful innovation to develop highly efficient and reliable

products and services.

Competitive Analysis – Success Factors

An in-depth competitive analysis has been caried out by critically making a

comparison between Ford and three of its major competitors in the automobile industry