One Ford Strategy

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Introduction………………………………………………………………………….3

The effects of the 2008 financial crisis on the global automobile industry……….3

The global strategies of Ford Motor and Nissan after the Recession…………......4

Benefits and limitations of Ford Motor’s and Nissan’s strategies………………...5 Short-term profitability…………………………………………………………..5 Long-run stability……………………………………………………………..6

Conclusion……………………………………………………………………………6

Introduction
The notion of “Global strategy”, in international business literature refers to a company that treats the world as largely one market and one source of supply with little local variation in order to achieve its goal of international expansion (Lynch, 2012). Economic factors, such as the worldwide economy and investment environment sustainability, play an essential part in the change in global strategies of multinational automobile companies. The automobile industry has seriously suffered since the 2008 global economic crisis. Globally, sales volume shrunk significantly and production costs increased rapidly. Therefore, most transnational automobile companies have improved or regulated their global strategies in order to achieve new economies of scale and scope and save localization Research and Development cost. This essay first discusses the severe impacts of the 2008 financial crisis on automobile industry. Second it compares and analyses two world “automobile giants”- Ford and Nissan - to investigate how international automobile companies conduct different global strategies to remain competitive and to keep high level efficiency and effectiveness after the 2008 worldwide economic crisis. Ford Motor’s ‘One Ford’ strategy focused on providing one style to the whole world whilst Nissan transferred their attention to emerging markets like China and the development of high technology green energy vehicles in developed markets like Europe. Thus, the essay concludes on the benefits and limitations of each company’s strategies.

The effects of the 2008 financial crisis on the global automobile industry IBISworld (2012) in its Global Car and Automobile Sales Market Research Report described the whole industry “is in the breakdown lane following a stormy end to 2008”. The continuous slide in light vehicle sales has been seen in almost all regions, among which the mature market - U.S.A and Western Europe – suffered most (Scotia bank Report, 2012). What is worse, due to the insufficiency of cash and financing sources, suppliers and dealers were placed the severe pressure in particular (KPMG report, 2009). Therefore the supplier may fail and production may have to stop (ibid, 2009). Considering the increasing expensive credit and financial tension, the relevant research institution held negative views towards the future. R.L.Polk company have released studies predicts that it will not until 2012 that the automobile markets will emerge from the worldwide recession (Zino, 2009) Situated in such economic environment, Ford Motor and Nissan both suffered unavoidably. Ford Motor, despite suffered from the sharply declining of the annual global volume from 5,532,000 units in 2008 to 4,817,000 units in 2009 (Ford annual report, 2009), is the only major US automobile company which has not have asked the government for financial support (BBC News, 2009), while its major competitors GM and Chrysler may be forced to file for bankruptcy or liquidity assets (Bender, Slade ad Thorpe, 2009). Nissan has been, however, on the tough road during and after the financial crisis to recovery. As they have reported, It has suffered the annual net operating loss in the year 2009 (Nissan annual report, 2009). Faced with economic recession, these two international carmakers started to rethink their own global strategies profoundly to find a way towards recovery.

The global strategies of Ford Motor and Nissan after the Recession The “ONE Ford” strategy was put forward and implemented by the CEO Alan...
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