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Ford Analyst

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  • Transcript

    • 1. Thursday, February 5 th , 2009 Matthew Clemson, Gavin McDowell, Stephanie Ramsay, David Spencer, Lindsey White FORD – ANALYST REPORT Group 10
    • 2. Financial Performance (5-10 Year Outlook)
    • 3. Revenue growth has severely lagged cost growth leading to slimmer margins, decreased cash flow, and ultimately, a steep decline in stock price. Ford’s Struggling Financial Performance
    • 4. Ford’s Struggling Financial Performance
    • 5. Stock Recommendations
    • 6. With Ford levered to the hilt and cash flow projected to be very low, we forecast a negative equity value of $44 billion. Investors have a big hole to crawl out of before even reaching the current $1.80 per share. We Do Not Recommend Ford Stock
    • 7. Marketing Landscape
    • 8. Competitive Landscape Low Price/High Quality Low Price/Low Quality High Price/Low Quality High Price/High Quality
    • 9. Re-Branding Amidst a Financial Crisis? Refreshed Brand Image and New Positioning
    • 10. Competitive Landscape Low Price/ High Quality Low Price/Low Quality High Price/High Quality High Price/ Low Quality
    • 11. “ Green Vehicles” Changes Ford’s Competitive Landscape
      • Tahoe and Suburban
      • Escalade
      • Chevrolet Trucks
      • Toyota Trucks/SUVs
      • Toyota Prius
      • Chevy Volt
      • Honda Insight
      • Kia Sonata
      • Honda Insight
      • Smart Car
      • Cooper Mini
    • 12. Brand Positioning Crossroad?
    • 13. Competitive Advantage
    • 14. Competitive Advantage Used Vehicles Affordability of New Cars
    • 15. Sustainable Competitive Advantage VALUE RARE INIMITABLE ORGANIZED Brand Equity Customer Loyalty Investment in Hybrid R&D Manufacturing Flexibility Green Awareness
    • 16. Complementary Business Units
    • 17. Complimentary Business Units Vehicle Warranty Certified Pre-Owned Vehicle Repair Service Ford Motor Credit
      • Established Program
      • Quality Reputation
      • Little Revenue
      • Consistent
      • Customers
      • 50% Claim Reduction
    • 18. Key Acquisitions and Alliances
    • 19. Acquisitions & Alliances
      • After acquiring a partial or whole interest in several different car companies throughout the 80’s and 90’s, Ford is in the midst of divesting all these interests in an attempt to raise capital.
      • Raised 9.34 Billion through “sell-offs”.
    • 20. Acquisitions & Alliances (cont)
      • Ford has been shopping Volvo in China. Why?
      • Sales increased throughout the early 2000’s. Sales have dropped recently but the perception has not. Include this brand in your Hybrid rollout.
      • Volvo holds a 71% stake in Brand Perception for safety. Ford can use this to carry over into other Ford products.
    • 21. Acquisitions & Alliances (cont)
      • Ford should continue to look to partner with foreign automakers in emerging markets.
      • Lowers original capital commitment and overall exposure.
      • Example: Alliance with Russian automaker GAZ.
    • 22. Product Plans
    • 23. Announced or Apparent Product Plans
      • Ford has invested heavily in hybrid, flex fuel, and plug in-vehicles.
      • Ford is in the best position out of all US automakers to take advantage of new energy efficient cars.
      • Ford plans to have a full family of hybrid vehicles by 2011-2012.
    • 24. Announced or Apparent Product Plans
      • 2007 partnership with Southern California Edison (SCE).
      • At this time, not a good use of funds.
      • Estimated 5000 – 10,000 plug-in vehicles sold in 2011.
      • Needed infrastructure is still well off into the future.
    • 25. Announced or Apparent Product Plans
      • Flex fuel cars have not been performing.
      • Consumer backlash, cars not starting, and other issues.
      • Ford should focus more on Hybrid technology.
    • 26. Announced or Apparent Product Plans
      • Ford has been listening to its consumers.
      • Redesigning such models as the Shelby GT500 and the almighty workhorse……the Taurus.
    • 27. Productivity Measurements
    • 28. Improving Productivity: Not a Competitive Advantage
      • Industry becoming leaner, slackers coming closer
        • Gap in 2003 was 10.51 hrs
        • Gap in 2008 was 3.50 hrs
      • Top 6 industry producers converge on productivity
        • Range narrows to 3.50 hrs from top to bottom producer
      • Toyota and Chrysler lead in vehicle labor hours
        • 30.37 hrs per vehicle
      • Ford improves productivity by 3.7%
        • 33.88 hrs per vehicle
    • 29. New Domestics Lead Plant Utilization Metrics
    • 30. Production Strategy
    • 31. Fords Global Footprint
      • 110 manufacturing plants in 23 countries
    • 32. Ford Changes Production Mix
      • Temporary closures to reduce supply
      • Ford is in the process of retooling production facilities to meet current market trends
      • Conversion from SUV to small car plants
        • Dearborn, Michigan
        • Mexico City, Mexico
        • Louisville, Kentucky
    • 33. Strategic Recommendations
    • 34. Company vs Analyst Comparison
    • 35. Questions