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FORD USA AG

FORD USA's website: http://www.ford.com/
FORD USA Chinese website: http://www.ford.com.cn/

Ford Motor Company is an American multinational corporation and the world's fourth largest automaker based on worldwide vehicle sales

Company Information

FORD USA—— One of FORD company's brand.

Ford Motor Company is an American multinational corporation and the world's fourth largest automaker based on worldwide vehicle sales, following Toyota, General Motors and Volkswagen. Based in Dearborn, Michigan, a suburb of Detroit, the automaker was founded by Henry Ford and incorporated on June 16, 1903. In addition to the Ford, Lincoln, and Mercury brands sold in the US and elsewhere, Ford's international brands also include Volvo of Sweden; and Ford owns a one-third controlling interest in Mazda of Japan, and a small holding in former subsidiary Aston Martin of England. Ford's former UK subsidiaries Jaguar and Land Rover were sold to Tata Motors of India in March 2008.

In 2007, Ford became the third-ranked automaker in US sales, after General Motors and Toyota, falling from the second-ranked automaker position for the first time in the previous 56 years. Globally, Ford fell to the fourth-ranked spot after Volkswagen based on 2007 sales. Ford is the overall seventh-ranked American-based company in the 2007 Fortune 500 list, based on global revenues in 2007 of $172.5 billion. In 2007 Ford produced 6.553 million automobiles and employed about 245,000 employees at around 100 plants and facilities worldwide. Also in 2007, Ford received more initial quality survey awards from J. D. Power and Associates than any other automaker, with five vehicles ranking at the top of their categories, and fourteen vehicles ranked in the top three.

Ford introduced methods for large-scale manufacturing of cars and large-scale management of an industrial workforce, using elaborately engineered manufacturing sequences typified by moving assembly lines. Henry Ford's methods came to be known around the world as Fordism by 1914.

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Company History

Ford was launched in a converted factory in 1903 with $28,000 in cash from twelve investors, most notably John and Horace Dodge (who would later found their own car company). During its early years, the company produced just a few cars a day at its factory on Mack Avenue in Detroit, Michigan. Groups of two or three men worked on each car from components made to order by other companies. Henry Ford was 40 years old when he founded the Ford Motor Company, which would go on to become one of the world's largest and most profitable companies, as well as being one to survive the Great Depression. As one of the largest family-controlled companies in the world, the Ford Motor Company has been in continuous family control for over 100 years.

In 2005, Ford Motor Company was among 53 entities that contributed the maximum of $250,000 to the second inauguration of President George W. Bush.

 

Corporate governance

Members of the board as of early 2007 are: Chief Sir John Bond, Richard Manoogian, Stephen Butler, Ellen Marram, Kimberly Casiano, Alan Mulally (President and CEO), Edsel Ford II, Homer Neal, William Clay Ford Jr., Jorma Ollila, Irvine Hockaday Jr., John L. Thornton and William Clay Ford (Director Emeritus).

The main corporate officers are: Lewis Booth (Executive Vice President, Chairman (PAG) and Ford of Europe), Mark Fields (Executive Vice President, President of The Americas), Donat Leclair (Executive Vice President and CFO), Mark A. Schulz (Executive Vice President, President of International Operations) and Michael E. Bannister (Group Vice President; Chairman & CEO Ford Motor Credit). Paul Mascarenas (Vice President of Engineering, The Americas Product Development)

 

Recent company developments

During the mid to late 1990s, Ford sold large numbers of vehicles, in a booming American economy with soaring stock market and low fuel prices. With the dawn of the new century, legacy healthcare costs, higher fuel prices, and a faltering economy led to falling market shares, declining sales, and sliding profit margins. Most of the corporate profits came from financing consumer automobile loans through Ford Motor Credit Company.

By 2005, corporate bond rating agencies had downgraded the bonds of both Ford and GM to junk status, citing high U.S. health care costs for an aging workforce, soaring gasoline prices, eroding market share, and dependence on declining SUV sales for revenues. Profit margins decreased on large vehicles due to increased "incentives" (in the form of rebates or low interest financing) to offset declining demand.

In the face of demand for higher fuel efficiency and falling sales of minivans, Ford moved to introduce a range of new vehicles, including "Crossover SUVs" built on unibody car platforms, rather than more body-on-frame chassis. In developing the hybrid electric powertrain technologies for the Ford Escape Hybrid SUV, Ford licensed similar Toyota hybrid technologies to avoid patent infringements.[14] Ford announced that it will team up with Southern California Edison (SCE) to examine the future of plug-in hybrids in terms of how home and vehicle energy systems will work with the electrical grid. Under the multi-million-dollar, multi-year project, Ford will convert a demonstration fleet of Ford Escape Hybrids into plug-in hybrids, and SCE will evaluate how the vehicles might interact with the home and the utility's electrical grid. Some of the vehicles will be evaluated "in typical customer settings," according to Ford.

In December 2006, the company raised its borrowing capacity to about $25 billion, placing substantially all corporate assets as collateral to secure the line of credit. Chairman Bill Ford has stated that "bankruptcy is not an option". In order to control its skyrocketing labor costs (the most expensive in the world), the company and the United Auto Workers, representing approximately 46,000 hourly workers in North America, agreed to a historic contract settlement in November of 2007 giving the company a substantial break in terms of its ongoing retiree health care costs and other economic issues. The agreement includes the establishment of a company-funded, independently-run Voluntary Employee Beneficiary Association (more commonly known as a VEBA) trust to shift the burden of retiree health care from the company's books, thereby improving its balance sheet. However, this arrangement will not begin to take effect until January 1, 2010. The agreement also gives hourly workers the job security they were seeking by having the company commit to substantial investments in most of its factories.

The automaker reported the largest annual loss in company history in 2006 of $12.7 billion, and estimated that it would not return to profitability until 2009. However, Ford surprised Wall Street in the second quarter of 2007 by posting a $750 million profit. Despite the gains, the company finished the year with a $2.7 billion loss, largely attributed to finance restructuring at Volvo.

In March 2008, Ford announced that it has reached agreement to sell its Jaguar and Land Rover operations to Tata Motors for $2.3 billion. The sale is expected to be completed by the end of the second quarter of 2008. It is understood that Ford Motor Company Ltd. will not retain any shareholding in either the Jaguar or Land-Rover companies, unlike Aston Martin where on its sale a small shareholding was retained; when the total sum to be paid in cash by Tata Motors of approximately US$2.3 billion, Ford will then contribute up to US $600 million to the Jaguar Land Rover pension plans.

In January 2008, Ford launched a website listing the 10 Built Ford Tough Rules as well as a series of webisodes that parodies the show COPS (TV Series).

 

"The Way Forward"

In the latter half of 2005, Chairman Bill Ford asked newly-appointed Ford Americas Division President Mark Fields to develop a plan to return the company to profitability. Fields previewed the Plan, dubbed The Way Forward, at the December 7, 2005 board meeting of the company; and it was unveiled to the public on January 23, 2006. "The Way Forward" includes resizing the company to match current market realities, dropping some unprofitable and inefficient models, consolidating production lines, and shutting fourteen factories and cutting 30,000 jobs.

These cutbacks are consistent with Ford's roughly 25% decline in U.S. automotive market share since the mid-late 1990s. Ford's target is to become profitable again in 2009, a year later than projected. Ford's realignment also includes the sale of its wholly owned subsidiary, Hertz Rent-a-Car to a private equity group for $15 billion in cash and debt acquisition. The sale was completed on December 22, 2005. A 50-50 joint venture with Mahindra and Mahindra Limited of India, called Mahindra Ford India, Limited (MIFL), ended with Ford buying out Mahindra's remaining stake in the company in 2005. Ford had previously upped its stake to 72% in 1998.[

Chairman and Chief Executive Officer Ford also became President of the company in April 2006, with the retirement of Jim Padilla. Five months later, in September, he stepped down as President and CEO, and naming Alan Mulally as his successor. Bill Ford continues as Executive Chairman, along with an executive operating committee made up of Mulally, Mark Schulz, Lewis Booth, Don Leclair, and Mark Fields.

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