International Business Strategy for Ford Case Study Essay

International Business Strategy for cross Case Study - Essay Example fording also started to build electric railway cars. The political forces facing this industry be getting more than and more severe. There be many classs in the society which are demanding stricter environmental norms for the railroad carmobile industry (Hoffman, 2012, p. 211). Ford has so far done a good job in maintaining the image as a workers truck. Ford has attracted the attention of other affectionate and economic groups which have high-class luxury vehicles. Ford operates in many international countries such as Australia, Japan, UK and America where the business operations are conducive. In 1975, the Corporate Average Fuel Economy took effect, and Ford was able to abide by the regulations. Non-compliance with these laws ca utilize healthy fines, which would prove costly to the company. This made Ford manufacturer one of the most fuel efficient and environmentally friendly cars. The Government also di scourages Ford to fully automate its operation which would otherwise result in increase of the unemployment rate. Economic forces The leading manufacturers of the vehicles were mainly companies from United States, Western European and Japanese companies. Ford used to produce more vehicles outside their home country than within their own country. The auto industry remained fragmented. In 2010, there were a total of 18 manufacturers with their annual output being more than 1 one million million million vehicles. 3-firm concentration ratio which is measured by the units of production was around 31.5 percent. There were many mergers and acquisitions in the auto industry still they faced new competition from other countries especially India and China. Figure 1 Mergers & Acquisitions among the major(ip) automobile manufacturers. (Source Ledderhos, 2003, p.68) (Source Ledderhos, 2003, p.67) Strong competition from the companies forced Ford to go for cost reduction through economies of sco pe, economies of scale, oecumenic outsourcing, off-shoring, just-in-time scheduling and collaboration. In spite of the many cost reduction techniques, the major automakers were still unable to allude the low cost automakers from India, China and elsewhere. The euro zone crisis further exasperated the problem of Ford (Ireland, Hoskisson and Hitt, 2010, p. 75). Social Factors The social factors which affect Ford are the changes in the social classes in the world market. With increasing globalisation the car market is witnessing increase in spending from the middle and upper middle income families all across the world. The lines mingled with the social strata are diminishing. Hence companies all around the world are now targeting the middle income group to increase their volume sales. This helps the motor company in expanding their market across the world. This results in more manufacturers approach shot out with products which cater to the middle income people and results in rise in competition (Stead, Stead and Starik, 2004, p. 89). The consumers are now demanding better quality, safer vehicles at lower prices which have forced Ford Company to produce cars at cheaper ways like outsourcing the parts of their production in outside countries. Hence the company needs to pad new processes and methods of creating attractive, unique automobiles