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Executive Summary

Ford Motor Company has been recognized for a long time for its innovative nature in the automobile business. Their R & D department has done a recommendable job in ensuring continuous innovation in manufacturing and assembling their products. The company has a number of other prestigious brands that work under its name. It is mainly comprised of the Lincoln and Ford brands. It is ranked 6th largest business that is related to the automobile industry. It is estimated that it has sold more than 1 million automobiles by the end of 2014.

It is working aggressively on expanding its market share in the world and is expected to record CAGR (Compound Annual Growth Rate) percentage that it seeks to target, for instance, 1 million in terms of sales unit by 2020. Under its new management, its vision is to hasten the one Ford strategy that was endorsed in 2007 under its previous CEO (Chief Executive Officer). The primary intention of the plan is to reorganize and rationalize the company’s operations and a line-up of the product. This will be achieved by launching new models that satisfy the needs of the customer, maximize the profitability of the business by improving the current profitability ratio and enhancing teamwork (Toms).

The corporate strategy of the business is that it has established more than 5 R & D centers that deal with their engineering researches across the world and that they are interconnected. Ford Australia is seeking to streamline operations and improve its efficiency by joining platforms which will be diminished by 2020. The R & D and the platform strategies, tend to work towards achieving Ford’s target unit sales an estimate of 1 million in 2 years and a CAGR of a percentage that is projected between 2014 and 2022. The management team of Ford Australia is made up of the CEO and president, Executive chairman and other people. The company has enjoyed a number of successes and this can be proved through their satisfied shareholders. Such successes were through their programs and innovative works in engineering and technology.

Introduction

Ford Australia/ Ford Motor Company of Australia Limited is a subsidiary firm of Ford Motor Company that is based in Canada. It specializes in importing, manufacturing and foreseeing the distribution of medium, small and large passenger service vehicle (PSVs) and heavy vehicles mostly used for commercial purposes for both universal and local markets (Ford Australia ). In Australia, Ford Australia is one of the top three automobiles manufactures with a reputable broad portfolio that is made up of notable brands such as Focus, Fiesta, Ranger pickup truck and Ford Kuga SUV among many others. It is well known for its excellence in technology and efficient manufacturing and assembling automobile processes (Mathews).

It has an established brand in Australia where its market trends have been positive throughout the years. Apart from striving to achieve its corporate goals, it has played a crucial role in the welfares of the community therefore motivated towards a sustainable development. The primary advantage of this business is that it has a universal commercial outlook that is driven by excellent technology which has gained the interest of the world. So by building vehicles that can be used locally, the Australian customers will enjoy a high-end technology that will cater to all their local needs.

Brand Diagnosis and Overview

Ford Australia operates under four main brands that are Lincoln, Volvo, Ford, and Mercury. Moreover, the firm has two main departments that are the financial services and automotive departments. The firm is divided into two departments, Automotive, and Financial Services. The company’s financial services are in the form of Ford Credit offers to finance of automobiles to its details and retail consumers. It is estimated that 27% of the vehicles sold by all the brands under Ford Australia were with the help of Ford credit. Those retailers who were able to buy automobiles from the company with the help of the financed service were estimated at 98%. Ford’s financial service has also helped their clients to finance dealership acquisitions of other capital expenditures such as real estate. Ford Australia automotive department helps in the manufacturing, designing and servicing trucks, service cars, SUVs and automobile spare parts among others. The sale of the company’s automobiles is usually done through dealerships.

Industry Analysis (Ford Australia Porter 5 star Analysis)

Ford Australia faces a stiff competition from other automobile manufacturers such as Toyota and Hyundai who are also venturing in the Australian market. It is therefore important for this business to study the environmental factors that are influencing Ford Australia. By understanding it, the business will be able to operate in a smooth manner and maximize its profitability as a long-term strategy to deal with the dynamic nature of the market (Doyle).

Competitive Rivalry

The nature of the automobile industry is that it is highly competitive. The Australian market is now attracting new entrants who are quick in building themselves. The major competitors that the company faces are Toyota, Nissan, Honda, and Chrysler among many others. Many of this brands have been able to offer a great challenge to Ford Australia because they tend to offer their products at a lower price (Meyer). Due to low costs of labor, end high efficiency, they have been able to gain profits from smaller vehicles. Ford previously had been specialized in SUVs and truck lines as they were losing money on small vehicles.

The Bargaining power of Buyers

It is based on how sensitive the customers are as all the manufactures of automobiles in the Australian market tend to produce products with the close likeness. In order to control the bargaining power of the buyer, the business has introduced a number of finance schemes and discounts. Ford through its Ford Credit has been able to help their customers finance their purchases. Brands such as Holden have strategies in place that seek to target people with low incomes by providing automobiles that fit their pay scales and which have limited characters. This competitive nature of the market tends to cut the pricing authority of manufacturers hence affecting Ford and this becomes the main reason why their profit margins have been diminishing (Mathews).

The Supply Power

The Australian automobile industry has seen the suppliers influencing prices of products as they are also seeking high rates of compensation. Moreover, they tend to have a number of brands as they are seeking profit maximization. Due to such activities, Ford Australia has been experiencing hardships in maintaining a high-profit margin. The fact that the market has a number of brands, it is to the advantage of suppliers hence affecting the demand management of the brands.

The Labor Market

Due to its competitive nature, the Australian automobile market supports high salary scales for their employees and this trend has been rising gradually. Ford Australia is having a hard time to retain its highly trained and skilled labor as they tend to opt for their competitors who have higher salaries.

Entry and Exit of brands in the market

The Australian market is open and free so there are no barriers for other brands to establish their territories. This poses a challenge to Ford Australia as the competition of the market will be increased.

Industry Analysis (Ford Australia SWOT Analysis

Strengths

1. Ford Australia has an easy access to capital financing hence has a financial advantage to the other three automobile manufacturers.
2. They have a great customer satisfaction as compared to their competitors as their product line is respected by experts in the automobile industries and their competitors tend to see it as being a step above them.

• Apart from the Australian market, Ford Australia has a strong global brand recognition and has a solid existence in Europe.

1. Ford Australia is professed to be systematically “American” brand, this makes it be a priority in certain groups of customers.
2. The Australian market share is stable and suitable for Ford Australia.
3. One of their products the Ford F-series pickup is a reputable commercial automobile that has retained its respect since its launch. Regardless of the shifts in demand, profitability must be maximized.

• Ford Australia has better labor policies and strategies as compared to its competitors.

Weaknesses

1. Ford Australia is affected by poor profitability, for instance, it tends to lose its finances on numerous automobile lines within Australia.
2. Availability of a single source for components (Visteon).

• The market for automobiles tends to be expensive and highly competitive. Moreover, it requires continuous long-term planning in terms of development and research.

1. Ford Australia has managed only to a small market segment in Asia as far as exports are concerned.
2. The universal excess capacity of vehicles is estimated to be around 30 million yearly between 2009 and 2011.

Opportunities

1. Ford Australia has seen the need for vehicles that are fuel efficient in the market.
2. Ford Australia is seeking to create a margin increase for its smaller line of vehicles in Europe.

• Experiences a slight market increases.

1. The government involvement in Ford Australia debt matters as compared to their competitors has placed the business at a competitive advantage.
2. Ford Australia has a capacity to take over a small market share in the event its competitors go bankrupt.

Threats

1. Ford Australia have times been faced with financial issues hence straining its capital making them seek for government bailouts.
2. The sales for their trucks are gradually dropping even after the business seeks to readjust its production.

• In the event that their competitors go bankrupt, there could be a disruption in the market supply’s chain.

1. The company’s strategy of standardization runs a high risk of failing as it is based on the taste of a consumer rather than the company’s
2. It also faces a challenge of ever-increasing fuel prices making many Australians prefer to go back old larger vehicles that had low consumption of fuel.
3. The failure of the Ford Fiesta, one of the company’s products in the U.S. has a lot of implication in the Australian market, for instance, will it behave in the same manner.

• The supply system is weak as Ford Australia tends to depend on its competitors in the vent of a bankruptcy affecting any, the business will be affected adversely.

Competitor Assessment

            The target population of Ford Australia is travelers, individuals who want to own vehicles, institutions, and retailers among many others. In order to understand its competitors, it is important that it analyses the financial reports of their competitors. Ford Australia has a current market gap that is thought to be $ 10.1. In the last 5 years, Ford has been experiencing a hard time with their shares as they gradually dropped. The equity valuation for both Ford and General Motors had fallen. In 2005, Ford Stock was being sold at $14 but it ended up closing at $4 4 years later. Ford’s profit growth in 2008 recorded a loss of 14.57 billion and also the Volvo brand also recorded a loss of $736 million. It is therefore clear that the automobile industry has the same working trend that affects brands in the sector.

Ford’s Australia Marketing Strategy

The company’s marketing mix (4Ps) has enhanced its ability to interact with its customers not only in Australia but also in the international market hence has a comprehensive marketing mix (Ford). The components of this mix also tend to evolve over time in order to ensure it develops to fit the level of competitiveness in the market. Moreover, this marketing mix is responsible for the business to reach its target population and is connected with the strategic actions of the business.

Ford’s Australia Product Mix

Ford Australia offers a variety of products. It is most popularly known for its automobiles. It also has trucks, buses, tractors, vehicle leasing, automobile parts, trucks, and financial services. Moreover, its motor craft brand is composed of parts of the automobile for most of its vehicles. Some of this parts are also sold to their competitors such as Toyota. Its credit company serves as a subsidiary that offers financing services to its customers. Vehicle leasing is only made to cooperate with customers. It is therefore evident that the product mix of this organization is shown in this element.

Ford’s Australia Place/Distribution Mix

The organization uses typical venues or places to enhance its product distribution strategy. This element of the market mix emphasizes the locations or venues that Ford Australia will use to sell to their customers. This places may include achieving sales revenue through the use of dealership to distribute their products Ford’s Australia automotive parts are usually availed to the market through third parties and its website. The firm’s financial services can be accessed by customers through the company’s offices or different people at dealerships. This market mix element shows that the strategy of this organization is to use third parties and its open facilities to grow sales revenue.

Ford’s Australia Promotional Mix

Ford’s Australia promotes its products through conventional techniques that are available and are considered in this element of marketing mix (Ford). Their promotional activities include the use of adverts mainly through media and the internet such as online advertisements. Sales/agents help the organization to maximize their sales revenue by persuading potential customers at Ford dealerships and various locations to buy the company’s products. The organization may also apply for direct sells as a means to promote their products, particularly to corporate clients. Sales promotion is another strategy that is used in this element. This is achieved mainly through trade-ins and discounts. Through sponsorships and corporate social responsibility programs, Ford Australia has managed to increase its awareness of the target population. From this element, it is therefore clear that Ford implements efficient marketing communication techniques to promote itself.

Ford’s Price Mix

The price that the company offers usually depends on the market. This element of the marketing mix entails the determination of the prices of the company. The main pricing strategies that are used include the market-oriented strategy that entails setting prices that are appropriate to the condition of the market that is putting into consideration factors such as the demand of the product, the competition level in the market the perception of consumers among many others. This strategy is mainly applicable to the business’s products such as tacks and sedans. It also uses the premium pricing strategy that entails setting the company’s prices of some of their products to go high. This is mainly used for Lincoln automobiles one of the organization’s products. Ford uses these strategies in order to secure various market segments.

What you want to achieve with the brand

What I want to achieve with the brand is to help it achieve its financial scheme by the bank offering financing programs to target those people who want to buy from the business.

Marketing Plan

Ford Inc. was developed in 1906 and in 1917, it made its first truck. The main objective of Ford Australia is, “to enhance our trucks, to challenge our competitors and to gratify our patrons.” The mission is, “to be relevant and profitable to the future” (Ford). Lastly, the values are “One team, One Plan, and “One Goal.” The objective of this marketing plan is to ensure an increase in the Australian market by 10%, retain our reputation of having the best truck in the market so far, create social welfare programs and improve the environment. It also seeks to improve on the quality of their products through innovation in engineering and technology and lastly have safety measures as our priority for our customers. The implementation and evaluation of this marketing plan will be achieved by the company retaining its status as having the best truck in the market. It is also implemented by promoting environmental awareness programs and also ensuring the safety of the customer (Ford).

Brand initiatives

The Unlearn initiative is one of the initiatives that were made by Ford. It seeks to encourage consumers to look at look at the company and themselves as a new thing new. It targets new ford cars such as the Edge and Mustang.

Marketing Metrics

Market Share (%),

Sales Volume (units), 

 Brand Awareness (%), 

 Profitability ($)

Statistics stipulates that the total revenue for Ford’s between 2008 and 2017 is estimated to be $156.8 billion.

Conclusion

 From the study, it is clear that even for a well-established institution like Ford have modified its strategies and processes this is because of the dynamic nature of the automobile industry in Australia which a business must be able to fit. For an organization to achieve its strategies, it must be able to integrate the functional features of an organization with such strategies such as controlling, leading, organizing and planning.