Ford Porter's Five Forces Analysis
Introduction
An Overview of Ford Motor Company
Ford Motor Company, basically known as Ford, is a company that distributes and manufactures automobiles and vehicle parts including cars, trucks and SUVs, in a global scale (Automotive Business Review, 2014). Having three owned brands namely Ford, Ford-Lincoln and Lincoln, the company operates crucial centers and facilities such as distribution centers, engineering, R&D facilities, sales offices and manufacturing facilities in North America, South America, Europe, Asia Pacific and in the African region. The company has a subsidiary called Ford Motor Credit Company LLC (Ford Credit) that provides car rentals, leasing, car financing, insurance and any other car financing related activities. Furthermore,
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Bargaining Power of Buyers: Since Ford is a highly known brand in the world and known for its reputation, buying power is very limited and only those who have the means to buy are mostly from the upper middle class to the upper class. Dealers still need to finance their purchases with the help of Ford Credit.
Bargaining Power of Suppliers: The bargaining power of suppliers is strong since it is only necessary that the raw materials used by Ford should be of high quality. Ford can dramatically impact the stability of its supply chain if they change their production and demands from their suppliers. Ford has put efforts in reducing multiple suppliers and turn to highly few reliable suppliers (UK Essays, 2014).
Rivalry: According to Harsh (2013), Ford faces five major competitors namely: General Motors, Toyota, Chrysler, Honda and Nissan. Competitors like Toyota, Honda and Nissan have increased in market share since they can deliver better products (being fuel efficient) at more affordable prices. Ford has been losing market and profits on its smaller vehicle lines though they have managed to remain competitive in Europe by designing cars that appeal to the European market. Ford has to continuously strive for innovation, style and efficiency to keep
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The brand has built a strong reputation among consumers that is reliable, efficient and stylish which drive loyal buyers. The company has a wide network of distributors and dealers with good relations established across the globe. This ensures that products ordered are delivered to their respective buyers, establishing customer satisfaction. Ford has high employee productivity and highly qualified individuals in the company that are well compensated based on their work performances. Ford has invested heavily in research and development which has keep on improving company products and technology that meets international standards and the changing demands of the global
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