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CLC: Strategic Management Case Analysis Part 1: Action Plan and Calendar of Events
Ford Motor Company was created in 1902 by Henry Ford with only 12 investors and $28,000 in cash. The first car was sold in July 1903 and by October 1903, Ford was making a profit. Two to three men worked on each car with parts being supplied by outside firms for the Model T created in 1908. 15 million Model T’s were sold between 1908 and 1927 when production ended. To keep employee morale up, Ford paid his workers $5 per day and reduced the work day from nine hours to eight hours. In 1927, Ford began selling the Model A. Even with the Great Depression, over five million Model A’s were sold. Over the next two decades, Ford’s sales grew, causing the largest IPO in history up to 1956. However, in 2005, Ford’s bonds were downgraded to junk, and many economic factors such as rising health-care costs and gas prices negatively affected the company. A deal was reached with the United Auto Workers allowing Ford to avoid a government takeover. As of 2015, Ford is the second-largest U.S. automaker and the fifth-largest automaker in the world based on sales. Global market share grew 7.6 percent in Q2 of 2015, 12 of 16 planned product launches have been completed, and pre-tax profit and net income are up $2.9 billion and $1.9 billion.
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