The vision of Ford in China is to become a top player in the Chinese market by taking full advantage of the low manufacturing costs in the country, and ensuring that it meets the demands of its customers, investors, employees, suppliers, dealers and communities (Thompson, 2017). The company’s mission is to be passionately committed to offering individual mobility for the citizens of the land in which it operates and around the globe by anticipating the needs of consumers, and delivering outstanding services and products that improve their lives. Ford’s marketing strategy is to provide innovative vehicles in the Chinese market. Ford targets the smaller locales of China, but not the megacities because there are regulations in the megacities that limit the number of cars that a person should own with the aim of reducing pollution. However, the buyers from the smaller locales are not restricted to own a certain number of vehicles.
Nissen (2013) states that the spin of Ford under the leadership of its C.E.O, Allan Mulally, has led to its tremendous growth since 2006. It has moved from recording huge losses to posting yearly profits. Mulally has been tactical in his style of leadership because he has been able to motivate and inspire the company’s employees towards realizing a universal mission. Thus, he has been able to inspire the workers to engage in activities that are of benefit to the company. The tactical leadership approach has played a key role in China by impacting the company’s direction and vision in a manner that makes it grow in the smaller locales of China. Mulally views leadership as an honor to serve everyone in equal measure, and ensure that employees comprehend the company’s vision, plans, and also feel that they have the support of the executives. Tactical leadership ensures that employees are always optimistic.
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According to Vlasic (2017), Ford Motor Company focuses on building small cars’ next generation in China, but not in Mexico or the United States of America. The company looks forward to venturing in the Chinese motor market because it sees a vacant capacity in the Asian country. It also intends to capitalize on the country’s lower costs of labor. The company is presently building its Focus Compact car in China. The company’s head of global operations is categorical that investing in a car production plant in China, rather than Mexico will save the company one billion dollars. Additionally, the company will be in a position to deliver a variety of small-car choices for its customers in a manner that makes business logic.
Ford intends to relocate its operational plans to Chongqing in China from Michigan mid-2018. The company has the plan of saving up to a billion dollars through the importation of its Ford Focus small cars from its plant in China because of the available lower labor costs in the country. The company is presently manufacturing the Focus model for its global customers in China, though imports to the U.S are intended to start soon. The global operations’ president, Joe Hinrichs, emphasizes that the company’s decision to sell abroad its products from the plant of Chongqing has never been a decision that revolves around a variable cost, rather the decision is to free up lots of capital that would be required to set a plant in the U.S or Mexico. The company focuses on reducing costs just like its rivals have done. It considers U.S as a country in which expenses are constantly increasing because of investment in technology, which reduces profits.
There are three largely appreciated leading indicators like the one published by the National Statistics Bureau (NBS) of China, Organization for Economic Cooperation and Development, and the formal purchasing index of managers have been trending since the early months of 2010, just in the same way as the economy. However, the falls have been slower than their sudden declines in 2008. Additionally, their deceleration rate has typically slowed in the latest months, insinuating at stabilization in the economy of China.
Ford Motors Company considered shifting the production of its automotives to Chongqing from U.S, as well as the production of Ford Focus model in Mexico to China because of the need to avoid needless investment and retooling costs. As a result, it will be saving a billion U.S dollars in investment costs if compared to its initial Focus manufacturing plan in either the U.S or Mexico (Rabinovitch, 2012). Additionally, the firm’s plan to move to China will improve its financial health, as wealth as its production scale in China. The company also considers scaling up its operations in China rather than refitting or constructing factories in Mexico or the U.S because it intends to save on costs. Colias and Rogers (2017) records the quotes of Ford’s President, Joe Hinrichs, “leverage existing capacity, and frankly invest in one less plant to build the Focus worldwide, and that involves things like tooling for the body shop.”
The core competencies of Ford are in its brand recognition and value chain. The company is well distinguished as the founder of the mass manufacturing system that includes SUV, family sedan, muscle car, truck, family van, and compact. Also, the company has a robust network of supply chain. Its base of suppliers and strategic alliances are the most advantageous globally.
According to Miller (2017), Ford Motors Company seems to be cyclical sales because of its sensitivity to the business cycle. Its revenues specifically in the U.S and China are not steady, but rather they are always higher during expansion and prosperity in economy, and lower during economic contraction and downturn.
References
Colias, M., & Rogers, C. (2017). Ford to move production of Focus to China. The Wall Street Journal. Retrieved from http://www.marketwatch.com/story/ford-to-move-production-of-focus-to-china-2017-06-20
Miller, D. (2017). Fo rd Motor Company's China Sales Absolutely Slumped in March. Retrieved from http://www.foxbusiness.com/markets/2017/04/17/ford-motor-company-china-sales-absolutely-slumped-in-march.html
Nissen, M. (2013). Alan Mulally Explains How He Turned Around Ford . Retrieved from http://www.businessinsider.com/alan-mulally-leadership-style-2013-11?IR=T
Thompson, A. (2017). Ford Motor Company’s Vision Statement, Mission Statement . Retrieved from http://panmore.com/ford-motor-company-vision-statement-mission-statement
Rabinovitch, S. (2012). Charting China’s leading indicators . Retrieved from http://ig-legacy.ft.com/content/7a4d9ac2-cc35-11e1-9c96-00144feabdc0#axzz4nrXAhi4K
