`Mobil Analysis

Automobile IndustryAutomobile Industry

Group 3Group 3Matt DavisMatt Davis

Charlie KimCharlie Kim

Adam KingAdam King

Brian LarsonBrian Larson

Sean RedmondSean Redmond

Andy SchickAndy Schick

S.W.O.T. AnalysisS.W.O.T. Analysis

FordFord General MotorsGeneral Motors Daimler/ChryslerDaimler/Chrysler

Major StrengthsMajor Strengths

Ford Motor CompanyFord Motor Company DiversityDiversity

JaguarJaguar VolvoVolvo Mercury Mercury LincolnLincoln MazdaMazda Land RoverLand Rover

Second Largest Automaker in the WorldSecond Largest Automaker in the World Owns Hertz Rent-A-CarOwns Hertz Rent-A-Car Ford Motor CreditFord Motor Credit

Ford StrengthsFord Strengths

SupportiveSupportive Gave Generously after the September 11 AttacksGave Generously after the September 11 Attacks Give Generously to Help Fight Breast CancerGive Generously to Help Fight Breast Cancer Support Racing TeamsSupport Racing Teams

NASCAR NASCAR Formula OneFormula One Etc.Etc.

44thth on the Fortune 500 List (U.S. only) on the Fortune 500 List (U.S. only) 44thth on the Global 500 List on the Global 500 List 3939thth on the Best Companies for Minorities List on the Best Companies for Minorities List

General Motors CompanyGeneral Motors Company

World’s Largest Auto ManufacturerWorld’s Largest Auto Manufacturer In 2000, Sales Exceeded $183 Billion In 2000, Sales Exceeded $183 Billion

GloballyGlobally Gaining $5 Billion in ProfitsGaining $5 Billion in Profits

Manufacturing Facilities in Over 30 Manufacturing Facilities in Over 30 CountriesCountries

Sell Vehicles in Over 200 CountriesSell Vehicles in Over 200 Countries As of 1999, GM Held 15.1% of the As of 1999, GM Held 15.1% of the

Automobile MarketAutomobile Market

GM StrengthsGM Strengths DiversityDiversity

Chevrolet, Pontiac, Buick, Oldsmobile, Chevrolet, Pontiac, Buick, Oldsmobile, GMC, Cadillac, Saturn, Hummer, SaabGMC, Cadillac, Saturn, Hummer, Saab

DominanceDominance 33rdrd on Fortune 500 List on Fortune 500 List 33rdrd on Global 500 List on Global 500 List

Alliances with Suzuki and Isuzu Motor Alliances with Suzuki and Isuzu Motor CompaniesCompanies

Technological Alliances with Toyota and Technological Alliances with Toyota and Honda Motor CompaniesHonda Motor Companies

Setting the StandardSetting the Standard

Daimler/ChryslerDaimler/Chrysler

Leaders in the Mini-Van Lines of Leaders in the Mini-Van Lines of AutomobilesAutomobiles

Became More Sleek Looking with TimeBecame More Sleek Looking with Time Leaders in the Convertible LinesLeaders in the Convertible Lines

SebringSebring

Major Major WeaknessesWeaknesses

Ford Motor CompanyFord Motor Company

Firestone Tire RecallsFirestone Tire Recalls Caused Stock Price to Suffer--$14.70, Caused Stock Price to Suffer--$14.70,

Lowest in YearsLowest in Years CEO Jacques Nasser and Chairman Bill CEO Jacques Nasser and Chairman Bill

Ford Jr. Cannot Get AlongFord Jr. Cannot Get Along This past Week, Bill Ford Took Over as CEOThis past Week, Bill Ford Took Over as CEO

Cash Reserves Have Sunk to $4.1 BillionCash Reserves Have Sunk to $4.1 Billion $13 Billion on Acquisitions$13 Billion on Acquisitions $3.5 Billion to Cover Tire Recalls$3.5 Billion to Cover Tire Recalls

General MotorsGeneral Motors

Recalls Have Hindered GrowthRecalls Have Hindered Growth 314,000 Mini-Vans made between 1997-314,000 Mini-Vans made between 1997-

20002000 Repair Power Sliding DoorsRepair Power Sliding Doors

Maybe Too Diverse?Maybe Too Diverse? Might Lose Focus on Some LinesMight Lose Focus on Some Lines


Lack of DiversificationLack of Diversification Feel the Need to Refurbish Older Lines to Feel the Need to Refurbish Older Lines to

Stay CompetitiveStay Competitive Smaller Share of the Market than Ford or Smaller Share of the Market than Ford or

GMGM

OpportunitiesOpportunities

Ford Motor CompanyFord Motor Company

More Environmentally FriendlyMore Environmentally Friendly Cleaner Engine EmissionsCleaner Engine Emissions Working With Environmental Groups to Working With Environmental Groups to

Help Clean the EnvironmentHelp Clean the Environment Solar PowerSolar Power

GenerosityGenerosity Giving to More CharitiesGiving to More Charities


GMAC Financial ServicesGMAC Financial Services Mortgage, Auto, and Business FinancingMortgage, Auto, and Business Financing

Electronic Business and Digital Electronic Business and Digital TechnologyTechnology

Direct TVDirect TV OnStar SystemOnStar System

Becoming More Environmentally Becoming More Environmentally FriendlyFriendly


State-of-the-Art Technology Center in State-of-the-Art Technology Center in Auburn Hills, MIAuburn Hills, MI

Hard at Work to Keep Chrysler CompetitiveHard at Work to Keep Chrysler Competitive

Need to Expand More Into Foreign Need to Expand More Into Foreign MarketsMarkets

Threats!!!!Threats!!!!

The threat are really the same across the The threat are really the same across the board for the automobile industry. board for the automobile industry. Competition is huge, in this industry, and Competition is huge, in this industry, and nothing hurts a company more than nothing hurts a company more than internal strife, as is the case with Ford internal strife, as is the case with Ford Motor Company. Also an impending Motor Company. Also an impending recession does not smile upon any recession does not smile upon any industry in this day and age. industry in this day and age.

Toyota StrengthsToyota Strengths

PartnershipsPartnerships EPA Global 500 AwardEPA Global 500 Award #1 of Japanese Producers#1 of Japanese Producers SUVsSUVs

Toyota WeaknessesToyota Weaknesses

Poor WebsitePoor Website

Toyota OpportunitiesToyota Opportunities

Hybrid EnginesHybrid Engines MatrixMatrix

Toyota ThreatsToyota Threats

Consumer ConfidenceConsumer Confidence

Honda StrengthsHonda Strengths

Used CarsUsed Cars Honda InsightHonda Insight PopularityPopularity

Honda WeaknessesHonda Weaknesses

EuropeEurope PassportPassport

Honda OpportunitiesHonda Opportunities

AlliancesAlliances Fuel EfficiencyFuel Efficiency

Honda ThreatsHonda Threats

Second MoversSecond Movers

Nissan StrengthsNissan Strengths

TeamsTeams Revival PlanRevival Plan

Nissan WeaknessesNissan Weaknesses

Low Market CapitalizationLow Market Capitalization RenaultRenault

Nissan OpportunitiesNissan Opportunities

Revival PlanRevival Plan

Nissan ThreatsNissan Threats

Low Market ShareLow Market Share Losing CompanyLosing Company

Porter's Five Porter's Five Forces in the Forces in the Automobile Automobile

IndustryIndustryCharlie KimCharlie Kim

Five Forces Within Auto Five Forces Within Auto IndustryIndustry

Threat of New EntrantsThreat of New Entrants Bargaining Power of suppliersBargaining Power of suppliers Bargaining power of buyersBargaining power of buyers Threat of substitute productsThreat of substitute products Rivalry among competing firmsRivalry among competing firms

Threat of New EntrantsThreat of New Entrants

Slow sluggish state of economySlow sluggish state of economy Personal consumption declined from 4.5 Personal consumption declined from 4.5

to 2.9%to 2.9% Productivity decreased in Productivity decreased in

manufacturing levelmanufacturing level Automotive sector has no space for Automotive sector has no space for

new entrants new entrants Small demand base and wide choiceSmall demand base and wide choice

High Fixed cost and constant R&DHigh Fixed cost and constant R&D

Bargaining Power of Bargaining Power of Buyers and SuppliersBuyers and Suppliers

Automakers design and assemble, Automakers design and assemble, suppliers have little responsibilitysuppliers have little responsibility Trust has been scarred by Ford-Firestone Trust has been scarred by Ford-Firestone

problem.problem. Essentially little power is given to Essentially little power is given to

supplierssuppliers Japanese emphasize trust in suppliers Japanese emphasize trust in suppliers

allowing for collaborative design effortsallowing for collaborative design efforts Corporate culture allows for such an Corporate culture allows for such an

arrangement to workarrangement to work

Bargaining Power of Bargaining Power of BuyersBuyers

Customers take over management of Customers take over management of world’s car business.world’s car business. Over capacity - wider choice – zero Over capacity - wider choice – zero

switching costswitching cost More discerning customersMore discerning customers Dealer FreedomDealer Freedom Better-quality productsBetter-quality products

Consumers take advantage of current quality Consumers take advantage of current quality in productin product

Threat of substitute Threat of substitute productsproducts

Natural gasNatural gas ElectricityElectricity EthanolEthanol Vegetable oilVegetable oil SunlightSunlight WaterWater

Intensity of Rivalry Intensity of Rivalry among Competitorsamong Competitors

Gas crisis during 1980’s and 90’sGas crisis during 1980’s and 90’s Foreign Trade increased intensity of Foreign Trade increased intensity of

rivalryrivalry Export becomes essential to Export becomes essential to

expanding and competing expanding and competing

Financial ComparisionFinancial ComparisionPricPricee

Mkt Mkt CapCap

P/EP/E P/P/SalesSales

ROEROE

FF 16.216.211

29.4b29.4b 49.749.733

0.190.19 4.084.08%%

DCXDCX 35.435.4 35.5b35.5b NMNM 0.280.28 --4.474.47%%

GMGM 41.841.844

23.01b23.01b 28.828.888

0.140.14 2.612.61%%

HMCHMC 73.873.877

35.99b35.99b 15.415.455

0.640.64 12.0512.05%%

NSANNSANYY

9.019.01 17.9b17.9b 7.317.31 0.40.4 43.5143.51%%

TMTM 49.349.322

91.2b91.2b 17.017.077

0.880.88 9.699.69%%

IndustIndustryry

37.337.311

0.270.27 0.930.93%%

S&P5S&P50000

29.729.799

3.683.68 17.7317.73%%

Financial ComparisonFinancial Comparison

HighlightsHighlights StrengthsStrengths WeaknessesWeaknesses

General EnvironmentGeneral Environment

Demographic SegmentDemographic Segment PopulationPopulation AgeAge InternetInternet Income DistributionIncome Distribution

Sociocultural SegmentSociocultural Segment JobsJobs Women in the WorkforceWomen in the Workforce ConsumersConsumers

Technological SegmentTechnological Segment EnvironmentEnvironment AluminumAluminum

Global SegmentGlobal Segment

Economic SegmentEconomic Segment

Very International, with the main Very International, with the main places being United States, Europe, places being United States, Europe, and Japanand Japan

Historically auto stocks move with Historically auto stocks move with direction of North American sales direction of North American sales cyclecycle

Until September U.S. retail car and Until September U.S. retail car and light truck sales declined in nine of light truck sales declined in nine of last ten months.last ten months.

U.S. EconomyU.S. Economy

Struggling in recent monthsStruggling in recent months Going to have to spend its way out of Going to have to spend its way out of

sharp downturnsharp downturn Congress considering temporary tax Congress considering temporary tax

rebates and accelerate planned rebates and accelerate planned permanent cutspermanent cuts

JapanJapan

Verging on deep recessionVerging on deep recession Predict tax revenue shortfall of $1.1 Predict tax revenue shortfall of $1.1

trillion yen this year.trillion yen this year. Livestock industry seeking $104 b Livestock industry seeking $104 b

yen in aid for losses from Mad Cow yen in aid for losses from Mad Cow in Septemberin September

GermanyGermany

Economic growth increase Economic growth increase moderatelymoderately

Inflation will fallInflation will fall Overspending on health and sharp Overspending on health and sharp

economic slowdown raise deficiteconomic slowdown raise deficit

Political/Legal SegmentPolitical/Legal Segment

Global Agreement on Vehicle Global Agreement on Vehicle RegulationsRegulations

Trade barriersTrade barriers


Claim to be the pacesetter for the Claim to be the pacesetter for the automotive industryautomotive industry

Has the largest share of the world’s Has the largest share of the world’s vehicle market at 15.1%vehicle market at 15.1%

Offer a variety of services including Offer a variety of services including GMACGMAC

Strive for technological innovations Strive for technological innovations such as the Onstar systemsuch as the Onstar system

FordFord

Passion for better ideasPassion for better ideas Pushing the limits of technology and Pushing the limits of technology and

designdesign Striving to make the world a better Striving to make the world a better

placeplace Concerned with environment and Concerned with environment and

developing more efficient automobilesdeveloping more efficient automobiles Built Ford toughBuilt Ford tough

Daimler ChryslerDaimler Chrysler

Striving to become the number one Striving to become the number one automobile manufacturer in the worldautomobile manufacturer in the world

Formed various partnerships to Formed various partnerships to enhance access to various global enhance access to various global marketsmarkets

Premium priced productPremium priced product Leader in innovative designs and Leader in innovative designs and

stylesstyles

HondaHonda

Manufacturers of a wide range of Manufacturers of a wide range of productsproducts

Industry leader in fuel-efficiency and Industry leader in fuel-efficiency and low emission technologylow emission technology

Maintains values of a small company Maintains values of a small company despite competing in a global despite competing in a global marketmarket

NissanNissan

Slogan of “thinking ahead”Slogan of “thinking ahead” Offer a sport edition for every model Offer a sport edition for every model

of car they produceof car they produce Development of ecologically minded Development of ecologically minded

transportationtransportation Believe that design is the most vital Believe that design is the most vital

contact they have with their contact they have with their customerscustomers

ToyotaToyota

Slogan is “get the feeling”Slogan is “get the feeling” Devoted to the customer and excel Devoted to the customer and excel

in customer servicein customer service Local outreach programsLocal outreach programs High standards for dependabilityHigh standards for dependability

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`Mobil Analysis