1. Why do you think that Ford historically made different cars in different regions? What are the advantages of Ford’s historic strategy? What are the drawbacks?

2. What global developments forced Ford to rethink its historic strategy?

3. How will the One Ford strategy benefit Ford? What does this strategy mean for Ford’s ability to compete in established markets like the US and Europe, and emerging markets like China?

4. Using the framework outlined in this chapter and summarized in figure 8.3, how would you describe Ford’s global strategy?

When Alan Mullaly, the CEO of Ford, arrived he was shocked to learn that the company produced one Ford Focus for Europe and a completely different one for the United States. The strategy of designing and building different cars for different regions was the standard approach at Ford. Because of this, Ford was unable to buy common parts for the vehicles and could not share development costs. The result was high costs.

Ford based this strategy on the assumption that consumers in different regions had different tastes and preferences, which required considerable local customization. When the global financial crisis rocked the automobile industry in 2008-2009, Mullaly decided it was time to change their strategy in order to control their costs. He also believed there was no way Ford could compete in large developing markets like India and China, unless it produced low-cost cars. The result was Mulally’s “One Ford” strategy, which aims to create a handful of car platforms that Ford can use everywhere in the world. Under this strategy, new models share a common design, are built on a common platform, use the same parts, and will be built in identical factories around the world.

Ultimately, Ford hopes to have only five platforms to deliver sales of more than 6 million vehicles by 2016. Ford hopes that this strategy will bring down costs sufficiently to make greater profit margins in developed markets, and make good margins at lower price points in hypercompetitive developing nations.