Ford Motor Company

Topics: Balance sheet, Cash flow, Asset Pages: 13 (3376 words) Published: June 21, 2013
MBA 615
Ford Motor Company

May 8, 2013

Table of Contents

Introduction……………………………………………………………… Page 3 History…………………………………………………………………… Page 4 Justification……………………………….. …………………………….. Page 5 Recommendation…………………………………………………………. Page 9 References………………………………………………………………… Page 10 Appendix A……………………………………………………………….. Page 11 Appendix B ……………………………………………………………….. Page 15

Introduction
Ford Motor Company

Ford Motor Company, the first major car manufacturer in the United States founded by Henry Ford in 1903, is the world’s fifth largest automaker and is an American multinational corporation. Ford has invested in various global markets over the years. Among the product lines that Ford has invested in are Ford, Lincoln and Mercury based primary in the US and Volvo, Mazda, Aston Martin, Jaguar and Land Rover which are all international brands. This American multinational corporation also invests in NASCAR where it is one of four manufactures in the Sprint Cup Series, Nationwide Series, and Craftsman Truck Series and offers auto loans thru Ford Motor Credit and PRIMUS Financial Services. Based on global revenues in 2011 Fortune 500 listed Ford as the tenth-ranked American-based Company.

History
Initially Ford only produced US models of Ford, Lincoln, and Mercury and sold those models globally. This was not that successful, so in turn Ford started producing and selling products that meet the needs of supply and demand and had the potentially of making Ford a global competitor. The global investments of this company has enable them to own one-third of Mazda located in Japan, a small holding in former subsidiary Aston Martin of England, be able to sell Jaguar and Land Rover to Tata Motors of India for 2.3 billion dollars and to extend lines of credit to dealerships selling Ford Motor Company products and provide private-label financing to other Ford owned brands such as Mazda, Jaguar, Volvo, and Land Rover. Ford survived the great depression and many other financial crises. In 2011 Ford discontinued its Mercury division, completed the sale of Volvo, divested its Mazda shares, and saw sales jump 17%. Ford manufactures or distributes automobiles across six continents. It currently employs about 163,000 People and has 70 plants. Ford Motor Company has always been an innovator in the field of automotive technology, introducing products like the fuel-saving Fusion and C-MAX hybrids. The introduction of this new fuel saving device is just another example of Ford’s commitment to excellence.

Justification
The risk-free rate of return on assets is the theoretical rate of return of an investment with zero risk. The risk-free rate represents the interest an investor would expect from an absolutely risk-free investment over a specified period of time. The current rate of return on risk free assets is 2.21% (see appendix B) Beta is a measure of a stock's volatility in relation to the market and is a key component for the capital asset pricing model. It is important for companies to know their own standing in the market to determine their ability to raise capital for new projects without for themselves. According to Yahoo Financial the beta for ford is 1.56. (See appendix B). Although independent auditors are a good source of information for consumers who are looking for stocks to invest in, they do not conduct the assessment of the company; rather they verify the reports that have been submitted by the company. The report is only an opinion on whether the information presented is correct and free from material misstatement. The unqualified opinion of yahoo financial indicates four things, (1) The Financial Statements have been prepared using the Generally Accepted Accounting Principles which have been consistently applied; (2) The Financial Statements comply with relevant statutory requirements and regulations; (3) There is adequate disclosure of all material matters relevant to the proper presentation of...

References: Ford Motor Co. (2013). Financial Reports. Retrieved May 2, 2013 from
http://corporate.ford.com/our-company/investors/investor-quarterly-results
Ford Motor Co. (2013). Climate Change and the Environment. Retrieved May 10, 2013
from http://corporate.ford.com/microsites/sustainability-report-2011-12/environment
Hoffman, Derek. (2013). Ford Motor Earnings Preview: Can this Streak Continue. Retrieved on
May 10, 2013 from http://wallstcheatsheet.com/stocks/ford-motor-earnings-preview-can-this-streak-continue.html/
Yahoo Finance. (2013). Ford Motor Co. Retrieved May 2, 2013 from:
http://finance.yahoo.com/q/ks?s=F
Income Statement | All numbers in thousands |
Period Ending | Mar 30, 2013 | Dec 30, 2012 | Sep 29, 2012 | Jun 29, 2012 |
| All numbers in thousands |
Period Ending | Mar 30, 2013 | Dec 30, 2012 | Sep 29, 2012 | Jun 29, 2012 |
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