Essay Ford: Company Analysis

Words: 3080
Pages: 13


Ford Motor Company have been around since 1903, and although in the past they lost market shares due to production and marketing scandals, they remain robust in 2005. This paper has been written to thoroughly analysed Ford through PESTEL analysis to comprehend the macro environment in, Porter’s Five Forces analysis to determine the competition and lastly SWOT analysis to depict the micro environmental factors of the company in question. It has been concluded that due to the fierce competition in the industry, and due to the changes in the environmental factors, Ford Motor Company needs to concentrate on improving on its weaknesses in order to avoid and overcome the threats.

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• Technological factors further affect the automotive industry in terms of the reputation of individual firms. Chrysler, Toyota and Ford have had to recall cars for expensive repairs in the past, which has had negative affects on their reputations. Ford has recently been involved in a tyre scandal costing $2bn, Chrysler recalled cars due to faulty locks and Toyota in November had to recall cars due to corrosion of car parts (BBC, November 2005). Technology is necessary to ensure the quality of finished vehicles.
Environmental Factors

• Hurricanes in the US have caused the oil prices to fluctuate (BBC, October 2005).
• Due to global warming and the carbon dioxide gasses emitted from vehicles the public may seek public transport in an attempt to protect the environment.
• Petrol is anticipated to finish within the next 50 years (BBC, June 2004).

Legal Factors

• Car manufacturers are increasingly reducing their numbers of employees due to technology replacing man power. However, pressure from Trade Unions in the US and the EU make it difficult for car firms to dismiss employees. For this reason individual firms such as Ford and GM are attempting to make deals with trade unions in order to protect themselves. (BBC, September 2003)
• The European Commission have changed the rules regarding car distribution, to allow the dealers to have more freedom to compete across the EU.