strategic-management

In late 2009, Ford added shifts at its truck plants in Michigan and Missouri due to
increased demand for its F-150 pickup trucks and Escape SUVs. The company’s
Dearborn, Michigan, truck plant and the Kansas City, Missouri, plant returned to a
three-shift operation. The action increased production of F-150 pickup trucks by about
10,000 units and boosted production of Ford’s Escape and Mercury Mariner SUVs
together by 2,400 units.
Ford’s increased production for the third and fourth quarters of 2009 were somewhat
driven by strong sales in the Cash for Clunkers program. The program, launched by
the U.S. government in July 2009, enabled qualifying consumers to trade in their old
gas-guzzling cars and trucks with a mileage of 18 miles per gallon (mpg) or less for a
value of up to $3,500–$4,500. Ford had two models in the top-10 buy list of the Cash for
Clunkers program. The company’s Ford Focus (30 mpg) ranked fourth and Ford Escape
SUV (24 mpg) ranked tenth. Ford boosted third quarter 2009 production in North
America to 495,000 vehicles and then produced 570,000 vehicles for the fourth quarter,
a 33 percent rise from the year-ago period.
For July 2009, Ford reported an astounding 2 percent year-over-year sales gain when
other major automakers reported declines. The sales gain was the company’s first since
November 2007. Ford still, however, is in financial trouble.
Develop a strategic plan of action for Ford. Provide a detailed strategic analysis for
CEO Alan Mulally. Include the methodology and costs associated with implementation of
your recommended strategies for the next three years.
CASE 18 • FORD MOTOR COMPANY — 2009 183