Essay Ford Motor Company Memo

* 3. Executive Summary Page 1 Introduction Page X Company Description Page X Ford’s Values Page X Ford Today Page X Strategic Focus and Plan Page X Mission Page X One Team Page X One Plan Page X One Goal Page X Vision Page X Goals Page X Nonfinancial Page X Financial Page X Core Competencies Page X Situational Analysis Page X The Situational Analysis Page X

Ford Motor Company is America's one of the largest car manufacturer and seller. In year 1987 it faces an external business environment change in the form of new warranty policy announcement by its major competitors General Motor, which changes the current philosophy of warranty in U.S car market. This policy change may have implications not only on Ford’s sales and market share but also on various departments within organization (such as manufacturing, quality assurance, parts and service, and extended service plans) and their dealer network. In answer, Ford executives have to respond through a best suitable course of action by carefully analyzing the current market variables.

Since Ford management believe that the share prices were undervalued in the past few years, the implement of VEP is an effective approach to buy back part of its outstanding stocks, which is sim-ilar to share repurchases. For Ford management and family members, they are able to strengthen their control of the company. If all the Class B shareholders retained their stocks and all the $10 billion cash was disbursed to other shareholders, the percentage of Class B share would increase from 5.8% to 7.04%, and their 40% voting power will be further consolidated.

Ford has a very strong brand name and offers wide range of cars like automobiles, commercial vehicles, luxury vehicles etc. they also target different set of customers.

As a result, holding cash would be essential component of the firm strategy. To develop new products, buy new equipment or expand geographically, firm has to spend money on marketing research, product design, prototype development and so on. Moreover, if a recession hits and the economy start to slow down,

Many companies filed bankruptcy due to the 2006 economic recession. However, Ford was able to stay afloat due to its significant changes in products it had to offer. It gained many befits through reorganizing, extending, and contracting its product line. Currently the economy is showing signs of growth and Ford is confident that it will improve on its performance and profits for years to come. Mullaly stated, “You make less money on smaller cars, but we can make a return”. This will certainly be key to Ford’s success for years to

K-L Fashions’ balance sheet shows a company that has tremendous opportunities for investments. Allow me to explain. Any company with lots of cash is a reassurance to investors that the company can generate revenue. Their cash flows have been $272,640 in 2005, 82,540 in 2004, however their inventory increased by 7.13%, which indicates that the cash was invested in the inventory. In 2003 it was 321,390, and lastly it was 281,750 in 2002. The Cash & Cash Equivalents is trending in the right direction. Cash is king, you can’t manipulate cash. Either is there or not. Cash helps companies survive and grow. Secondly, the Accounts Receivables is trending upward. In my opinion this shows

"It is doubtful if any mechanical invention in the history of the world has influenced in the same length of time the lives of so many people in an important way as the motor car." So writes an American historian, thinking of the automobile alone. But it does not stand-alone. It was the automobile factory that introduced mass production, a process that has changed the lineaments of our economic and social life more profoundly than any other single element in the recent history of civilization. Nearly everyone has heard of this process, yet few have any detailed or exact knowledge of its inception and development. Enter Henry Ford. The true answers of what inspired this Michigan farmer to develop a production process that

Ford Motor Company is an American automaker and the world 's fifth largest automaker based on worldwide vehicle sales and is the second largest American automaker. Based in Dearborn, Michigan, a suburb of Detroit, the automaker was founded by Henry Ford, on June 16, 1903. In that same year, with 12 investors and 1000 shares, the company had spent almost all of its 28000 dollar cash investment by the time it sold the first Ford Model A on July 23 1903. By October 1 of that same year, Ford Motor Company had turned a profit of 37,000 dollars. By 1904, Ford Motor company built its first international plant in Walkerville, Ontario, right across the Detroit River from Ford’s existing facilities. The company was a separate organization with its own set of shareholders. it was created to sell vehicles not just in Canada, but also all across the British Empire (1904 current British Empire). Over the years Henry Ford Model T then put the world on wheels with a simple, affordable, and durable automobile.

GM’s pickup truck advantage through the first six months of the year exceeds 76,000 units. Prior to the release of its new pickup truck lines and its recent sales surge, Ford outsold GM for several years. Now GM leads Ford in the most profitable category and also battles Toyota and Nissan for midsize truck

The hiring of Hackett may not have been an exemplary decision on Ford’s part. Trey Chowder of Global Equities Research states Hackett is “clueless and hardly the innovator Ford needs right now.” It doesn’t feel Hackett is a forward thinker nor does he understand Ford’s challenges ahead. The R&D for electric and autonomous is cost prohibitive and in 2016, Ford spent $7.3 billion, up 8% from 2014. That is not encouraging, especially when Tesla is pulling ahead. Furthermore, Ford does not do a good job highlighting its innovations and this could be a reason why Ford shares do not trade at a premium. It is common knowledge in the automotive industry in order for an automaker remain competitive it must sell 15 million vehicles a year; Ford sold 6.5 million vehicles in 2016. Cloud computing and artificial intelligence are swiftly changing auto industry’s landscape. Although Ford recently announced it had invested $1.2 billion to build an R & D facility in Canada and hiring 400 engineers from BlackBerry Ltd, it will still be difficult to incorporate a software group within such a traditional automaker. It is a costly undertaking and Ford just does

Top executives of the company include CEO James Hackett, CFO Robert Shanks and Executive Chairman of the Board, William Ford (FT Staff, 2017). The United States has one of the largest automotive markets in the world and is home to many global vehicle and auto parts manufacturers (IA Staff, 2017). In 2009, the mass production of automotive vehicles dipped to 6 million while production had doubled in 2015 to more than 12 million vehicles (IA Staff, 2017). However, automotive sales have steadily risen every year since and by 2015 the U.S. had reach over 17.4 million units in sales (IA Staff, 2017). Respectively speaking, the automotive industry is responsible for around 4 percent of U.S. gross domestic product to date. Just in 2015 alone, the automotive sector has employed around a million people (IA Staff, 2017). The United States leads the way in the auto sales market as the second biggest overall vehicle sales company (IA Staff, 2017). Despite reducing the cost of goods, expenses and interest paid, Ford was unable to grow their net income. This inherently caused their net income to shrink -37.66% from 7.37 billion to 4.60 billion despite revenues that showed very little growth (CNN Staff, 2017). Just a few of the top shareholders of Ford include The Vanguard Group, Inc owning 264.42 million shares, Evercore Trust Company, NA with 202.95 million, BlackRock Fund Advisors with

The Ford Motor Company was founded in 1903 by Henry Ford and it is currently located in Dearborn, Michigan. Ford is in the auto making industry producing affordable cars under the brand of Ford, and luxury cars under the brand of Lincoln. Ford has a long term rating of Baa3 by Moody’s, meaning that it barely met the standard of being an investment grade and is subject to moderate credit risk. Almost all the Ford Bonds in Pimco’s portfolio have the time to maturity and duration.

Alan R Mulally, Ford’s Chief Executive, mortgaged all of the company’s assets, sold off a majority of its shares in many other companies and made job cuts in the hope to use the money to improve the fate of the company. Alan R Mulally, told the financial institutions that he plans to make Ford’s focus revolve around developing smaller, more fuel efficient vehicles in order to keep up with the foreign automotive producers, and increase domestic interest in the company’s products. After refocusing the company, Allen also introduce a new type of technology that would help Ford Motor Company appeal more to the eyes of the consumers. (Bill Vlasic, 2009)

11quadrupled, growing by 10,899,000,000. Then it was almost cut in half in the next year (2016), dropping by 6,864,000,000 – which remained almost twice as much in 2016 than it was in 2014. The reason could be that in 2015 they took out a large amount of debt to aide in expansion.The most significant source of Overall Cash Flow is from the Operating Activities; as Investing is a negative cash flow, and Financing Cash Flows fluctuate greatly. However, Finance Cash Flows had the most drastic changes over the listed years. Overall, it’s obvious that Ford Motor Company makes a decent majority of their money from Operating Activities. The most significant uses of cash are within the Investing Activities, the only cash flow activity that has a negative flow. Each year the Ford Motor Company consistently puts out more