Ford and the World Automobile Industry in 2009
Ford Motor Company was one of the “Big Three” companies to be able to omit having to file Bankruptcy. The automobile crises began in 2008 and companies in the automobile industry such as Chrysler and General Motors had to file Chapter 11 in order to survive the financial hardship (Grant, 2010). Ford Motor Company had a loss in the billions of stockholders equity yet they refused to the opportunity to accept the bail out from the government in order to save jobs and the company.
Synopsis of the Case
Ford Company had been facing one of the most challenging times within the Automobile Industry. Ford Motor Company Chief Financial Officer Lewis Booth when he was appointed shifted his attention from short-term survival to the longer term financial outlook. For the auto industry, the government created incentives to stabilize demand with programs such as scrapping old cars, purchasing new and fuel efficient models (Grant, 2010). Ford Motor Company due to the opportunity to accept the bail out from the government by December 2008 had begun to take a profitable turn.
Relevant Factual Information about the Problem or Decision the Organization Faced
As Ford Motor Company was facing financial crisis their Chief Financial Officer Booth was looking for methods to bring the company ahead. As short-term threat had receded he then turned his attention to Ford’s longer term which was financial outlook. Ford’s profitability would all depend on more than Booth’s plan, but also state of the automobile industry in post -recession. Booth was very confident that with stronger operational and financial performance that would allow Ford Motor Company to emerge as one of the survivors of the crisis. With the cost reduction measure that had been set in place Ford was starting to see a positive outcome.
Explanation of Relevant Concepts, Theories and Applications Derived from Course Materials
Even though, Ford Motor Company...