FORD MOTOR COMPANYSWOT ANALYSIS 2017

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ABOUT FORDName Ford Motor Company

Logo

Industries served Automotive and Financial ServicesGeographic areas served Worldwide (62 countries)Headquarters Dearborn, Michigan, U.S.Current CEO Mark Fields

Revenue US$149.558 billion (2015) increased 3.8% over US$144.077 billion (2014)

Profit US$7.373 billion (2015) increased 598% over US$1.231 billion (2014)

Employees 199,000 (2016)

Main Competitors

Fiat Chrysler Automobiles, General Motors Company, Honda Motor Company, Hyundai-Kia Automotive Group, PSA Peugeot Citroën, Renault-Nissan B.V., Suzuki Motor Corporation, Toyota Motor Corporation, Volkswagen AG Group and many other automotive companies.

Ford Motor Company business overview from the company’s financial report:

“We are a global automotive industry leader based in Dearborn, Michigan. We manufacture or distribute automobiles across six continents.

In 2015, we sold approximately 6,635,000 vehicles at wholesale throughout the world. Substantially, all of our vehicles, parts and accessories are sold through distributors and dealers, the substantial majority of which are independently owned.

In addition to the products we sell to our dealerships for retail sale, we also sell vehicles to our dealerships for sale to fleet customers, including commercial fleet customers, daily rental car companies, and governments.”[1]

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BUSINESS DESCRIPTION“ ”

1. Geographically diversified revenue streams

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STRENGTHSS WO T

55.5%

6.0%

5.9%

6.1%

3.4%

23.1%

United StatesChinaUnited KingdomCanadaGermanyOthers

Figure 2. Ford’s revenue breakdown by country

Source: Ford’s financial report[1]

Ford receives

76.9% of its revenue from 5

different markets

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STRENGTHSS WO T

Toyota receives 77.1% of its revenue from only 3

different markets

41.9%

25.1%

10.1%

3.1%

19.8%

Toyota sales

Japan United States China CanadaOthers

62.3%

7.2%

7.1%3.4%3.2%

17.8%

General Motors sales

United States Canada China

United Kingdom Brazil Others

Figure 3. Toyota Motor Corporation’s and General Motors’ revenue breakdown by country

General Motors receives even 83.2% of its

revenue from 5 different markets

Source: The respective companies’ financial reports[6][7]

1. Slowing R&D spending

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WEAKNESSESS WO T

Company 2015 R&D % change from 2014

As a % of revenues 2014 R&D % change

from 2013As a % of revenues

Ford 6.7 0 4.5 6.7 8 4.7

Toyota 8.4 10.3 3.7 7.6 12.8 3.5

Volkswagen 14 0 (same) 6.9 14 20.2 7.1

General Motors 7.5 1.4 4.9 7.4 2.8 4.7

Figure 6. Comparison of R&D expenditure – Ford and selected major competitors (in US$ billions)

Source: The respective companies’ financial reports[1][6][7][12]

Ford’s spending on

R&D has slowed down,

which may negatively impact the company in the future.

1. Future markets for self-driving vehicles

• Ford is currently in talks with Google to potentially create a joint venture for the development and building of self-driving cars.[18]

• Ford has only just begun to experiment in this area, with their first driverless cars due to be tested during 2016.[19]

• Google’s technology to be merged with Ford’s automotive manufacturing expertise creates a significant potential opportunity for both companies.

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OPPORTUNITIESS WO T

1. Increased competition

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THREATSS WO T

Ford’s main competitors

• Ford’s has been loosing market share in the U.S. to Toyota, Honda, Nissan and Hyundai.

• In China, many new Chinese automotive companies are expanding aggressively.

• Competition further intensifies due to an estimated global excess production capacity of 31 million units, in 2015.[1]

• Ford has to find a way to outcompete these new entrants and regain its market share in the U.S.

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THREATSS WO T

1. Ford Motor Company (2016). Form 10-K for the Fiscal Year Ended December 31st, 2015. Available at: http://corporate.ford.com/content/dam/corporate/en/investors/reports-and-filings/Annual%20Reports/2015-Annual-Report.pdf Accessed January 8, 2017

2. Rosevear, J. (2016). Why Ford's F-Series Will Win* the Pickup Sales Race This Year. Available at: http://www.fool.com/investing/general/2015/10/11/why-fords-f-series-will-win-the-pickup-sales-race.aspx Accessed January 8, 2017

3. Interbrand (2016). Best Global Brands 2015. Available at: http://interbrand.com/best-brands/best-global-brands/2015/ranking/ Accessed January 8, 2017

4. Forbes (2016). The World’s Most Valuable Brands. Available at: http://www.forbes.com/powerful-brands/list/ Accessed January 8, 2017

5. IHS (2016). IHS Names Automotive Loyalty Award Winners; General Motors Receives Top Honors. Available at: http://press.ihs.com/press-release/automotive/ihs-names-automotive-loyalty-award-winners-general-motors-receives-top-hono Accessed January 8, 2017

6. Toyota Motor Corporation (2015). Form 20-F for the Fiscal Year Ended March 31st, 2015. Available at: http://www.toyota-global.com/investors/ir_library/sec/pdf/20-F_201503_final.pdf Accessed January 8, 2017

7. General Motors Company (2016). Form 10-K for the Fiscal Year Ended December 31st, 2015. Available at: http://www.gm.com/company/investors/sec-filings.html Accessed January 8, 2017

8. Ford Motor Company (2016). Ford at CES Announces Smart Mobility Plan and 25 Global Experiments Designed to Change the Way the World Moves. Available at: https://media.ford.com/content/fordmedia/fna/us/en/news/2015/01/06/ford-at-ces-announces-smart-mobility-plan.html Accessed January 8, 2017

9. Business Wire (2016). Record Number of Ford Inventions Drives Innovation in Autonomous, Connected Vehicles, Electrification, Wearables. Available at: http://www.businesswire.com/news/home/20151222005341/en/Record-Number-Ford-Inventions-Drives-Innovation-Autonomous Accessed January 8, 2017

10. Rosevear, J. (2015). Ford’s CEO: We Want to Disrupt Like a Startup. Available at: http://www.fool.com/investing/general/2015/08/14/fords-ceo-we-want-to-disrupt-like-a-startup.aspx Accessed January 8, 2017

11. Statista (2016). Leading Automobile Manufacturing Groups Worldwide in 2014, Based on Vehicle Sales. Available at: http://www.statista.com/statistics/260021/global-vehicle-sales-of-automobile-manufacturers/ Accessed January 8, 2017 SLIDE | 10

SOURCES (1/3)

12. Volkswagen Group (2015). Annual Report 2014. Available at: http://www.volkswagenag.com/content/vwcorp/info_center/en/publications/publications.acq.html/archive-on/icr-financial_publications!annual_reports/index.html Accessed January 8, 2017

13. Fiat Chrysler Automobiles (2016). Annual Report 2015. Available at: http://www.fcagroup.com/en-US/investor_relations/financial_information_reports/annual_reports/annual_reports/FCA_2015_Annual_Report_on_Form_20-F.PDF Accessed January 8, 2017

14. Australian Broadcasting Corporation (2014). Ford Australia to Close Broadmeadows and Geelong Plants, 1200 Jobs to Go. Available at: http://www.abc.net.au/news/2013-05-23/ford-to-close-geelong-and-broadmeadows-plants/4707960 Accessed January 8, 2017

15. LeBeau, P. (2014). Big 3 Dominance Slipping as Competition Heats Up. Available at: http://www.cnbc.com/2014/12/18/big-3-dominance-slipping-as-competition-heats-up.html Accessed January 8, 2017

16. Naughton, K. (2015). Lincoln Revives Continental to Reverse Decades of Decline. Available at: http://www.bloomberg.com/news/articles/2015-03-30/lincoln-revives-continental-name-to-reverse-decades-of-decline Accessed January 8, 2017

17. Stampler, L. (2013). Execs Fired Over Ford Ads Starring Silvio Berlusconi with Tied and Gagged Women. Available at: http://www.businessinsider.com.au/execs-fired-over-ford-ads-starring-silvio-berlusconi-with-tied-and-gagged-women-2013-3 Accessed January 8, 2017

18. Fg m,m…Rosevear, J. (2015). Why Google and Ford might be Teaming Up on Self-Driving Cars. Available at: http://www.fool.com/investing/general/2015/12/22/why-google-and-ford-might-be-teaming-up-on-self-dr.aspx Accessed January 8, 2017

19. Rosevear, J. (2015). Ford Makes a Big Move with Self-Driving Cars. Available at: http://www.fool.com/investing/general/2015/12/19/ford-makes-a-big-move-with-self-driving-cars.aspx Accessed January 8, 2017

20. Moscaritolo, A. (2012). Google’s Self-Driving Car Takes Blind Man for a Ride. Available at: http://www.pcmag.com/article2/0,2817,2402340,00.asp Accessed January 8, 2017

21. Scott, M. (2015). China’s Slowdown in Context. Available at: http://www.bloomberg.com/news/articles/2015-12-28/china-s-slowdown-in-context Accessed January 8, 2017

22. Korosec, K. (2015). Ford’s China Strategy: Small can be Big. Available at: http://fortune.com/2015/07/28/fords-china-strategy/ Accessed January 8, 2017

23. IBISWorld (2015). Automobile Manufacturing in China: Market Research Report. Available at: http://www.ibisworld.com/industry/china/automobile-manufacturing.html Accessed January 8, 2017 SLIDE | 11

SOURCES (2/3)

24. Miller, D. (2015). Ford Motor Company: What’s Going on in China? Available at: http://www.fool.com/investing/general/2015/07/16/ford-motor-company-what-is-going-on-in-china.aspx Accessed January 8, 2017

25. Bloomberg Business (2015). China has More Space than U.S. for Adding Car Ownership. Available at: http://www.bloomberg.com/news/articles/2015-01-18/china-has-more-space-than-u-s-for-new-cars-chart-of-the-day Accessed January 8, 2017

26. Accenture Consulting (2015). China’s Automotive Market: Consumer and Digital Marketing Insights. Available at: https://www.accenture.com/us-en/insight-china-automotive-market.aspx Accessed January 8, 2017

27. Chauhan, C.P. (2015). Ford Bets Big on New Cars to Boost Indian Market Share. Available at: http://articles.economictimes.indiatimes.com/2015-08-13/news/65524152_1_ford-india-suv-ecosport-indian-market Accessed January 8, 2017

28. Gupta, N.S. (2015). Ford Opens Plant at Sanand in Gujarat. Available at: http://timesofindia.indiatimes.com/business/india-business/Ford-opens-plant-at-Sanand-in-Gujarat/articleshow/46705344.cms Accessed January 8, 2017

29. Kewley, A., and Cherry, M. (2015) Three Massive Trends Reshaping the Auto Industry. Available at: https://bluenotes.anz.com/posts/2015/11/three-massive-trends-reshaping-the-auto-industry/ Accessed January 8, 2017

30. Rosevear, J. (2015). Booming Auto Sales Mean More Big Profits for Ford. Available at: http://www.fool.com/investing/general/2015/12/20/booming-auto-sales-mean-more-big-profits-for-ford.aspx Accessed January 8, 2017

31. Trading Economics (2015). Unites States Fed Funds Rate: Forecast 2016-2020. Available at: http://www.tradingeconomics.com/united-states/interest-rate/forecast Accessed January 8, 2017

32. Tannenbaum, C., and Bangalore, A. (2015). Steady is Stellar: Economic and Interest Rate Outlook. Available at: https://www.northerntrust.com/insights-research/detail?c=ed2d58d06cc815828e653eecaf835dbe Accessed January 8, 2017

33. Statista (2015). Selected Automakers’ U.S. Market Share in November 2015, by Manufacturer. Available at: http://www.statista.com/statistics/343162/market-share-of-major-car-manufacturers-in-the-united-states/ Accessed January 8, 2017

34. Greenough, J. (2015). How Tech Companies will Win the Battle Over the Connected Car’s Digital Dashboard. Available at: http://www.businessinsider.com.au/how-tech-companies-will-win-the-battle-over-the-connected-cars-digital-dashboard-2015-12 Accessed January 8, 2017

35. Cain, T. (2016). Top 13 Best-Selling Pickup Trucks In America – 2015 Year End. Available at: http://www.goodcarbadcar.net/2015/10/usa-pickup-truck-sales-stats-september-2015.html Accessed January 8, 2017 SLIDE | 12

SOURCES (3/3)

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