When we think about Ford, we can see them as our dad or granddad’s favorite truck or maybe that classic car everyone wanted to get. Because of the company’s long history, Ford has become one of the significant parts of the USA’s lifestyle.
And, after everything, the company has matured and is still dominating the automobile industry with many strengths, weaknesses, opportunities, and threats, which we will get to know from the Ford SWOT analysis.
Ford: Company Overview
| Company | Ford Motor Company |
| Industry | Automobile |
| Founded | 16 June, 1903 |
| Founder | Henry Ford |
| CEO | Jim Farley |
| Headquarter | Dearborn, Michigan, U.S. |
| No. of Employees | 186,000+ |
| Annual Revenue | $158 billion (FY 2022) |
| Website | ford.com |
One hundred twenty years from now, Ford started its journey in 1903 with Henry Ford as an automotive manufacturer, thanks to all the experience Henry Ford had from working with the Edison Illuminating Company and his passion for cars.
The company has manufacturing facilities in 15 countries and sells vehicles in over 125 countries worldwide, with a total revenue of $158 Bn and approximately 173,000 employees globally.
With constant innovation and excellent products, Ford is still at the top of the mind of customers.
Product & Services of Ford
Automobiles | Luxury Vehicles | Commercial Vehicles | Automotive Parts | Pickup Trucks | SUVs
Ford Competitors
Toyota | Volkswagen | Hyundai | General Motors | Nissan | BMW | Mercedes | Honda | Tesla
Did You Know?
In the 1960s, the company introduced The Ford GT40, designed to beat Ferrari at the 24 Hours of Le Mans race. Not just the car won that year, but it also won four years in a row from 1966 to 1969.
Strengths – Ford SWOT Analysis
International Presence: With operations in over 100 countries, Ford has a significant global presence. The company has manufacturing facilities in North America, Europe, Asia, and South America and sells vehicles in more than 200 markets worldwide. In 2022, the sales jumped through the roof at an all-time high.
Strong R&D Wing: The company spent $7.8B on R&D, focusing on autonomous and electric vehicle technologies and new materials and manufacturing processes in 2022. Because of that, the company has established research centers in Europe, Asia, and North America to collaborate with academic and industry partners on cutting-edge research.
Steady Finance: Because of its stable and over-the-year solid financial performance, the company grew and expanded; as a result, revenue was $158 B, with a strong performance in North America and Europe in 2022. Besides, Ford’s balance sheet remains strong, with a total asset value of $255.9 B.
Extensive Product Line: Ford sold over 4.2 M vehicles worldwide, with F-Series cars dominating the entire year with a massive sales volume increase in 2022. Besides, the company offers many cars to meet different customer needs, thanks to its extensive product line, including popular models such as the F-150, Explorer, Mustang, and Escape.
Vast Network: Ford’s dealer network is essential to the company’s ability to reach customers, sell vehicles, and expand its horizon. In over 100 countries, with approximately 10,000 dealerships, Ford has a significant market share in several key markets, including major first-world countries like the USA, Europe, and China.
Weaknesses – Ford SWOT Analysis
Dependent Revenue Market: A company’s dependence on a few markets can leave it vulnerable to regional economic and political fluctuations. In this case, approximately 68% (108 B) of the company’s revenue came from the North American market in 2022, underscoring the importance of diversifying its revenue streams.
Unbalanced Sales: As per the data, the F-Series trucks account for a large percentage of Ford’s sales, more than 35% of Ford’s total revenue, while the Mustang is one of the company’s top-selling models globally. It creates an unbalanced sales revenue stream, making the company vulnerable to shifts in consumer preferences or changes in the competitive landscape.
Cheap Perception: While Ford’s cars is often viewed as affordable by consumers, it also led consumers to equate lower prices with lower quality or value, making it more difficult for Ford to compete with higher-priced brands. As a result, it will be challenging to expand the brand’s perception or introduce any product line as luxurious.
High Debt-to-Equity Ratio: A high debt-to-equity ratio limits the company’s ability to invest in new initiatives or pursue growth opportunities. As of 2022, Ford’s debt-to-equity ratio was 3.214, an improvement from the previous years, but higher than the industry standard and many of its competitors.
Low E-Vehicle Offerings: The world is undergoing a significant change in the automobile industry, and everyone wants e-vehicle now. But, the company has been criticized for being slow to develop new EV models, which could put it at a disadvantage in the long term. Besides, the company’s global sales of EVs or hybrids are meager compared to other competitors.
Opportunities – Ford SWOT Analysis
Market Expansion: With its well-established dealer network, Ford could capitalize on opportunities in emerging markets such as China, India, and Africa. Ford sold about 378,000 vehicles in China, representing a 2.1% market share. Ford’s market share in India was meager, with only 69,223 cars sold in 2022, a perfect opportunity for the company to grow.
Self-Driving Tech: Autonomous vehicle technology is expected to be a significant area of growth in the automotive industry in the coming years. The market for autonomous vehicles is expected to reach $614.9 B by 2030, and by investing in self-driving tech, Ford could position itself as a leader in this market.
Eco-Friendly Cars: Ford has made significant investments in eco-friendly vehicles and technologies, including electric and hybrid cars, as well as more fuel-efficient models. Additionally, Ford has been trying to reduce its carbon footprint through sustainable manufacturing processes and materials.
Strategic Partnership: Collaboration and partnerships allow Ford to leverage the expertise and resources of other companies to develop new technologies and products. As a part of the process, it has entered into several strategic partnerships in recent years, including collaborations with Volkswagen and Rivian to develop electric vehicles and with Google to incorporate its Android operating system into Ford’s infotainment systems.
Threats – Ford SWOT Analysis
Recalled Vehicles: Recalls can be expensive for the company to address and damage consumer trust in the brand, and the number of recalled vehicles for Ford contentious to rise. In 2022 alone, Ford recalled over 8.6 M cars for various issues, such as faulty airbags and defective door latches.
Supply Chain Issues: The overall supply chain is a significant company’s backbone, and Ford has been facing supply chain issues for years. A November 2022 report shows that around 45K ford cars were being unsold because there were supply chain issues they couldn’t solve.
Competitive Market: Ford operates in a highly competitive automotive market, competing with automakers like General Motors, Toyota, and Honda, not to mention other local manufacturers’ competitions. That results in decreasing the market share in the USA and globally.
Rising Material Cost: Due to supply chain disruptions in the Ukraine-Russia War, prices for raw materials in the automobile industry have increased significantly. For example, steel prices have risen by about 150% in the last two years, putting pressure on Ford’s profit margins and potentially leading to higher vehicle prices.
Economic Uncertainty: As history says, the 2008 recession hit the automobile industry pretty hard, resulting in a 40% sales drop for the next two years. As 2023 will be more difficult for the automakers, we will see the results in a sales drop and significant employee cuts, which is not good news for Ford.
[Bonus Infographic] SWOT Analysis of Ford
Recommendations for Ford
In years of struggles and making a brand, Ford has gone through a lot with many major and minor strengths and opportunities. But there are some weaknesses and threats that are coming in recent years, and here are some things they can do.
- Prioritizing investment in electric vehicle technology to expand its portfolio of EV offerings can help the company stay competitive.
- Exploring strategic partnerships with technology or other automotive companies to share resources and knowledge and develop new technologies or products.
- Continuing to prioritize R&D and investing in new technologies and initiatives could help the company maintain a strong position in the market.
- Exploring opportunities to expand into emerging markets with a growing demand for vehicles and a well-established dealer network could provide an advantage.
Frequently Asked Questions (FAQs)
What is Ford Called in Germany?
Ford is called Ford-Werke GmbH in Germany.
What is Ford’s Nickname?
Ford's nickname is Jerry.
Final Words on Ford SWOT Analysis
Ford is a globally recognized automotive company with a strong presence in international markets. While the company faces rising material costs and a lack of competitive EV offerings, it has a strong R&D program, a vast dealer network, and steady financial performance. Ford continues to invest in new technologies and initiatives to improve the customer experience, positioning itself for future success in the automotive industry.
References
- Wikipedia contributors. (n.d.). Ford Motor Company. Wikipedia.
- Wayland, M. (2022, August 3). Ford reports big jump in July sales, including for trucks and electric vehicles. CNBC.
- Grzelewski, J. (2022, October 13). Ford to open R&D center in Atlanta in bid to attract tech talent. The Detroit News.
- Boudette, N. E. (2023, January 5). Ford Sales Dipped in 2022, but Electric Vehicle Deliveries Surged. The New York Times.
- Korosec, K. (2023, February 3). Ford left ‘$2B of profits on the table’ in 2022. TechCrunch.
- Wayland, M. (2023, January 3). Ford says F-Series pickup continued its decadeslong dominance in 2022. CNBC.
- George, P. (2023, February 18). Ford can’t afford to miss on quality in the EV revolution. The Verge.
- Ford India Loss Widens To Rs 4,229 Crore In FY22. (2022, September 29). Outlook India.
- Menon, K. (2022, December 30). Ford Reveals Exactly How Its Electric Vehicles Are Impacting Its Plans To Be Greener. HotCars.
- Ford, Rivian dump plans to jointly develop a Ford electric vehicle. (2021, November 20). Reuters.
- Grzelewski, J. (2021, February 1). Ford, Google form “strategic partnership” on cloud services, Android operating system. The Detroit News.
- LaForest, A. (2023, January 1). Ford reports most U.S. vehicle recalls for second year, partial NHTSA data shows. Automotive News.
- Isidore, C. (2022, September 20). As many as 45,000 Fords can’t be sold because they’re missing parts. CNN.
- Jauhari, U. (2023, March 1). Steel prices rise again, but will they hold up? Mint.
- Rosevear, J., & Wayland, M. (2022, December 27). 2023 could be another difficult year for the auto industry – here’s why. CNBC
