The automobile industry occupies a large share of the global and Indian markets. In India, the automobile industry accounts for 18% of the national income and has a growth rate of 10-12%. Ford is a major player in the automobile industry and has been operating in India since 1907 through a joint venture. Some of Ford's popular models introduced in India include the Ford Ikon, Fusion, Fiesta, Mondeo, and Endeavour. The Ford Mondeo was initially successful in Europe but did not see similar success in India, potentially due to insufficient marketing and an excessively high price.

3. Nearly 18% of the total national income is being incurred from the automobile industry.

4. In India automobile industry has a growth rate is at the average of 10-12%.16 July 2009 case study analysis 2 Automotive Industry

5. 16 July 2009 case study analysis 3

6. "Make Every Day Exciting"

7. 16 July 2009 case study analysis 5

8. 16 July 2009 case study analysis 6 Henry Ford (Biography) Born on July 28, 1863. Green field Township, Dearborn, Michigan, U.S. Founder of Ford Motor Company. Introduced Model T. Father of Assembly lines used in mass production. Awarded 161 U.S. Patents

9. 16 July 2009 case study analysis 7 Model T Fordism: Fordism is the economic philosophy that widespread prosperity and high corporate profits can be achieved by high wages that allow the workers to purchase the output they produce, such as automobiles.

10. Ford set out to build a car which everyone could afford to buy . Model T – Tin Lizzie – Flivver. The attraction of the Model T was that its price never increased. Costing $1200 in 1909, the price in 1928 was only $295. By 1928 Ford was producing more than one car per minute. 16 July 2009 case study analysis 8

11. 16 July 2009 case study analysis 9 Cars were mass produced and every part was standardized Only one color and one engine size were available. By producing large number of cars on an Assembly Line Ford needed fewer skilled people and that cut the cost of paying wages. Assembly Lines : ‘… each man and each machine do only one thing ... the thing is to keep everything in motion and take the work to the man not the man to the work’

12. 16 July 2009 case study analysis 10 More Standardized parts are needed More people with jobs means that they can afford to buy a car! More jobs are created in other industries. Steel THE CYCLE OF PROSPERITY! Glass Rubber Leather

13. 16 July 2009 case study analysis 11

15. Accelerate development of new products.

16. Finance our plan and improve our balance sheet

17. Work together effectively as one team

18. Create a global “ONE” Ford . . . leveraging our global assets

19. Introduce a complete, competitive, leading fuel-efficient product family

20. Continuously improve our quality and productivity, and reduce our costs

22. 16 July 2009 case study analysis 14 1929 model AA 1928 model A 1931 model Tudor Sedan New ford fiesta 1946 ford sedan Ford fiesta Ford Ikon Endeavour

23. Automotive Industry 16 July 2009 case study analysis 15

24. BRAZIL BRITAIN Produced almost 3 million vehicles in 2007. Global companies are present in brazil, such as fiat, Volkswagen, ford, gm, Nissan, Toyota, Mitsubishi, Mercedes-Benz, Renault etc Always been export oriented. Today , employs about 850,000 people and produces about 1.5 million cars and 216,000 commercial vehicles per year, 75% of which are exported. 16 July 2009 case study analysis 16

25. CHINA GERMANY Rapid development since the year 2000. In 2008, 9.345 million motor vehicles were manufactured surpassing U.S. As the second largest automobile maker, after japan. The top 5 car sellers are Volkswagen, GM, Toyota, Nissan and Chery. The automobile was invented in Germany by Carl Benz. Ten car manufacturers : Porsche, Volkswagen, Audi, Bugatti, Lamborghini, Bentley, Skoda Auto, MAN, SEAT and Scania AB. 16 July 2009 case study analysis 17

26. JAPAN SOUTH KOREA The biggest auto manufacturing country in the world. Nissan began making trucks in 1914, and sold cars under the Datsun brand until it switched to Nissan in the 1980s Other major companies include Subaru, Mitsubishi, Mazda, range rover, Chevrolets, Suzuki, and Isuzu The fifth largest in the world in terms of production volume and the sixth largest in terms of export volume 16 July 2009 case study analysis 18

27. INDIA One of the fastest growing in the world. Domestic production is skyrocketing .The number of cars sold domestically is projected to double by 2010. 10-year plan aims $145 billion auto industry by 2016. $375 billion by 2015, up from $65 billion in 2002. 16 July 2009 case study analysis 19

28. INDIA The production of automobiles in India is largely aimed at local consumers. Several Indian manufacturers also export a diverse variety of auto components. Prediction of sales of 42 lakh four wheeler automobiles in India by 2015.Indian passenger vehicle exports are also expected to rise from 1,70,000 in 2006 to 5,00,000 in 2010. 16 July 2009 case study analysis 20

29. Exportscenario world's largest manufacturers of small cars 2008, Hyundai Motors alone exported 240,000 cars Nissan Motors plans to export 250,000 vehicles by 2011. General Motors to export 50,000 cars by 2011. 16 July 2009 case study analysis 21

30. It displayed a turnover of $160.1 billion (against $176.9 billion in 2005) and a historical loss amounting to $12.7 billion (against a profit of $1.44 billion in 2005) (...) 16 July 2009 case study analysis 22 Industry Trends

31. FORD ENTERING INTO INDIA 16 July 2009 case study analysis 23

32. Ford has been in India since 1907, but received government approval to forge a 50:50 partnership with Mahindra and Mahindra in 1995. In 1998, got the green signal to increase its stake in the joint venture to 92.18 percent and the company was re-christened as Ford India Pvt. Ltd. 16 July 2009 case study analysis 24

33. FORD IN INDIA cars spring to life at Ford's ,Rs. 1700 crore integrated, manufacturing plant at Maraimalai Nagar, 45 kms from Chennai. The plant, equipped with advanced manufacturing technology from Ford, covers 350 acres, provides employment to about 2,000 people directly and thousands indirectly . has a capacity to manufacture upto 100,000 vehicles per annum. Ford is a 6-Sigma company. Every step of every process is planned to perfection. 16 July 2009 case study analysis 25

34. 16 July 2009 case study analysis 26

35. Commitments As A Leading Car Manufacturer In India: special cell called the "Environmental Management system” Apart from this , Ford India Ltd. has always been vital in looking into the matters of social commitments. tries to employ locals in the manufacturing unit. 16 July 2009 case study analysis 27

36. Strategic Postures MISSION TO BE A GLOBAL, DIVERSE FAMILY WITH A PROUD HERITAGE, PASSIONATELY COMMITTED TO PROVIDING OUTSTANDING PRODUCTS AND SERVICES.” 16 July 2009 case study analysis 28

37. Plans Aggressively restructure to operate profitably at the current demand and changing model mix. Accelerate development of new products our customers want and value. Finance our plans and to improve our balance sheet. Work together efficiently as one team. 16 July 2009 case study analysis 29

38. Goals An exciting and viable FORD, delivering profitable growth for all . To sell all its car manufactured under its name by satisfying all the needs and demand of its customers. To gain operational efficiency in its work place 16 July 2009 case study analysis 30

39. SWOT Analysis 16 July 2009 case study analysis 31

40. The first model was the Ford Escort, which was later replaced by locally produced Ford Ikon in 2001. It has since added Fusion, Fiesta, Mondeo, Endeavour and Endeavour Thunder to its product line. 16 July 2009 case study analysis 32

41. Marketing Strategies Building and managing profitable customer relationships. Building and managing strong brands. Harnessing new marketing technologies in this digital age. Marketing in a socially responsible way around the globe. 16 July 2009 case study analysis 33

42. 16 July 2009 case study analysis 34 Ford Mondeo

43. MONDEO was a product in the D-segment Elegant, muscular exterior and stylish interior designed with quality, makes driving a pleasure. Innovative technology is used . Originally launched in Europe. Was rated as the car of the year in Europe, and was quite successful especially in the UK. 16 July 2009 case study analysis 35

45. Features Electronic Automatic Temperature Control AC with 4 speed blower and heater. Power adjustable driver and front passenger seats. Front foot well courtesy lights, Rake and tilt adjustable steering. Front passenger seat lumber support, Analogue clock, Audio system. Rear seat folding center armrest. Rear seats with adjustable height and Fuel computer. 16 July 2009 case study analysis 37

46. The Indian Reaction MONDEO was not quite popular in India as FORD did not indulge in aggressive marketing. Moreover, it also faced competition from other cars in this segment like Honda accord and Hyundai Sonata. The posture in the front seat was uncomfortable. It was not preferred during long journeys. During rains, the discs made a screeching noise. 7/16/2009 IIPM Gurgaon 38

47. What Went Wrong ??? First and foremost, the company did not have an effective advertising strategy in place. Ford indulged in slow skimming i.e launched MONDEO at an exceedingly high price and spent less on promotion. It was priced at an exceedingly high price of 16lacs. Lack of availability of car parts and service stations. 7/16/2009 IIPM Gurgaon 39

50. A Dreamy Ride The Mondeo is still, by far, the best driver’s car in the segment, with brilliant, crisp steering, and a real eagerness to dive into corners. The ride is still quite firm, and can still be jarring over potholes and ridges. It fels absolutely planted and stable, even at maximum pace, making it a delightful Expressway car. 16 July 2009 case study analysis 42